China’s central bank has once again made its stance on cryptocurrencies crystal clear: crypto trading and related activities remain strictly banned. In a recent announcement, the People’s Bank of China (PBoC) reiterated its prohibition of all crypto-related operations within its borders and emphasized its determination to increase enforcement measures.
This reaffirmation is part of China’s ongoing effort to maintain financial order and control over its monetary system. The central bank views cryptocurrencies, particularly stablecoins like USDT and USDC, as a threat to its monetary sovereignty and financial security.
Stablecoins Under Stricter Watch
While China has banned crypto in general since 2021, the latest warning highlights stablecoins as a specific area of concern. Stablecoins, which are pegged to traditional currencies like the US dollar, are often used for cross-border transactions and to bypass capital controls.
The PBoC stated that it will intensify its crackdown on stablecoins, seeing them as tools that could disrupt the financial system or be misused in illegal transactions. The government appears determined to block any loopholes that could allow crypto to re-enter the financial system through backdoors.
By tightening control over these digital assets, China is signaling that its crypto policy isn’t softening anytime soon—despite global adoption and growing institutional interest in digital currencies.
Focus on Centralized Control
China continues to push forward with its own digital yuan (e-CNY), a central bank digital currency (CBDC) fully controlled by the state. This aligns with Beijing’s broader goal: to offer a digital alternative that aligns with its regulatory framework, while blocking decentralized cryptocurrencies that operate outside government oversight.
This strategy reinforces the government’s commitment to economic control and the prevention of systemic financial risks.