China Doubles Down on Crypto Prohibition
The People’s Bank of China has once again made its position on cryptocurrencies crystal clear. At a major coordination meeting held on November 28, 2025, the central bank reiterated its complete prohibition of all cryptocurrency activities. This wasn’t just another routine announcement – it brought together high-level representatives from nearly a dozen government agencies, which tells you something about how seriously they’re taking this issue.
I think what’s interesting here is the timing. The meeting included officials from the Ministry of Public Security, the Cyberspace Administration, Supreme People’s Court, and multiple financial regulatory bodies. When you see that many agencies involved, it suggests they’re coordinating a comprehensive response rather than just making policy statements.
Legal Status and Risk Concerns
The PBOC’s statement was quite direct about the legal standing of cryptocurrencies. They emphasized that these digital assets don’t have the same legal status as traditional fiat money and cannot be used as currency in markets. All crypto-related activities are considered illicit financial operations under current regulations.
What caught my attention was their specific mention of stablecoins. They’re classifying stablecoins as virtual assets too, pointing to what they see as serious compliance gaps. The bank claims these assets currently fail to meet customer identity verification and anti-money laundering requirements, creating risks for money laundering, fraudulent fundraising, and illegal cross-border money transfers.
Market Dynamics and Enforcement Challenges
Officials noted that cryptocurrency speculation has been increasing again recently, leading to more frequent illegal activities. They acknowledged that the comprehensive regulations published back in 2021 achieved significant results when they first prohibited crypto trading and speculation. But apparently, new market dynamics have caused risks to rise once more.
This pattern isn’t entirely surprising. When you look at how crypto markets operate, there’s often a cycle of regulatory crackdowns followed by periods of renewed activity as participants find new ways to operate. The Chinese authorities seem to be recognizing this pattern and preparing for another round of enforcement.
Future Regulatory Direction
The PBOC described preventing and controlling financial risks as a “permanent duty,” which suggests they’re in this for the long haul. China will maintain its strict prohibition of virtual currencies, and they’re calling on all institutions to establish stronger monitoring mechanisms.
The emphasis on monitoring information and fund flows, increasing information sharing, and improving oversight frameworks indicates they’re looking to build more sophisticated detection systems. They want to take strong measures against illegal activities, though the specific methods weren’t detailed in the announcement.
It’s worth noting that while China maintains this hardline stance, the global crypto landscape continues to evolve. Other countries are taking different approaches, creating an interesting contrast in regulatory philosophies. But for now, China appears committed to its prohibition-first approach, viewing cryptocurrencies primarily through the lens of financial risk rather than innovation potential.
