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Monday Dec 1 2025 07:20
1 min
The People's Bank of China (PBOC) recently convened a multi-department coordination meeting to oversee the crackdown on virtual currency trading speculation (referred to as the 1128 meeting), reaffirming the 2021 policy that prohibits virtual currency operating activities.
Xiao Sa's legal team pointed out that China has a strict foreign exchange control system, typically limited to $50,000 USD per individual annually. With the rapid expansion of the stablecoin market, expanding use cases, and a significant increase in the number of crypto merchants, many cross-border capital flow requirements are now being met by stablecoins such as USDT and USDC.
Furthermore, stablecoins can facilitate money laundering or conceal the proceeds of criminal activities, and in judicial practice, foreign trade companies have used USDT and USDC to circumvent UN sanctions resolutions, thereby assisting sanctioned countries in foreign trade.
Lawyer Xiao Sa believes that this meeting does not indicate a policy shift and does not affect Hong Kong's pro-crypto policies. A clear division remains: the mainland imposes restrictions while Hong Kong adopts an open approach. The regulatory aim remains clear: financial innovation is permitted, but it must adhere to regulations and occur within specified frameworks.
For those working in the sector within China, it's crucial to stay informed of legal red lines, operate compliantly, and avoid complacency.
Risk Warning: This article represents only the author’s views and is provided for informational purposes only. It does not constitute investment advice, investment research, or a recommendation to trade, nor does it represent the stance of the Markets.com platform. When considering shares, indices, forex (foreign exchange), and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and may not be suitable for all investors. Leveraged products can result in capital loss. Past performance is not indicative of future results. Before trading, ensure you fully understand the risks involved and consider your investment objectives and level of experience. Trading cryptocurrency CFDs and spread bets is restricted for all UK retail clients.
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