What changes have occurred in China's regulatory attitude towards Crypto Assets over the past four years?

China's regulation of virtual currencies is expected to showcase a more precise crackdown strategy in 2025, with the number of participating departments increasing to 13, reflecting an upgrade in the scope and strategy of regulation.

In particular, the risks and potential misuse of stablecoins have been clearly defined for the first time, making future regulatory activities more stringent. This marks that China's regulation of virtual currencies has become a regular measure aimed at preventing financial and socio-economic security risks.

Article Introduction: The cryptocurrency regulatory storm in mainland China, which has continued for four years, shows no sign of easing. Instead, it is demonstrating a more precise crackdown strategy by the end of 2025.

In September 2021, the People's Bank of China and ten other departments jointly issued the "Notice on Further Preventing and Dealing with the Risks of Virtual Currency Trading and Speculation" (i.e., Document No. 237), which clearly defined that activities related to virtual currency constitute illegal financial activities for the first time, establishing a strict regulatory tone for virtual currency in our country.

On November 28, 2025, four years later, the central bank will hold a meeting of the coordination mechanism for combating the speculation and trading of virtual currencies, attended by thirteen departments, emphasizing the continued adherence to the prohibitive policy on virtual currencies.

With four years between two important meetings, China's virtual currency regulation strategy has evolved from an initial comprehensive definition and prohibition to a more precise and in-depth crackdown system. Comparing the regulatory actions of ten departments to thirteen departments between 2021 and 2025, the most significant difference is the increase in the number of participating departments.

The "Notice" of 2021 was jointly issued by the People's Bank of China and ten other departments, while the 2025 meeting expanded to include responsible comrades from thirteen departments such as the Ministry of Public Security, the Central Cyberspace Affairs Commission, the Central Financial Office, and the National Development and Reform Commission. The increase in the number of departments not only indicates an expansion of the regulatory scope but also demonstrates an upgrade in regulatory strategies.

The regulatory framework in 2021 mainly focused on finance, network information, market regulation, and other areas, while in 2025 it included more law enforcement and macro-management departments. This change reflects China's judgment that the risks of speculative trading in virtual currency have expanded from purely financial risks to broader socio-economic security risks.

The 2025 conference clearly stated: "Making risk prevention and control a permanent theme of financial work, continuing to adhere to the prohibitive policy on virtual currency, and continuously cracking down on illegal financial activities related to virtual currency." This indicates that after four years of practice, the regulation of virtual currency has become a regular component of China's financial risk prevention and control, rather than a temporary or campaign-style rectification action.

The "Notice" in 2021 clearly defined the risks of stablecoins and comprehensively delineated mainstream virtual currencies such as Bitcoin, Ethereum, and Tether, clarifying that they "do not possess the same legal status as fiat currency." The 2025 conference continued this tone while publicly defining stablecoins for the first time.

The meeting clearly pointed out: "Stablecoins are a form of virtual currency that currently cannot effectively meet the requirements for customer identification, anti-money laundering, and other aspects, and there is a risk of being used for illegal activities such as money laundering, fundraising fraud, and illegal cross-border fund transfers." This marks a more detailed and in-depth understanding of the risks of virtual currency by Chinese regulatory agencies.

Stablecoins, as a type of virtual currency that attempts to peg its value to fiat currency, have rapidly developed worldwide in recent years. However, their so-called "stability" does not change their intrinsic nature as virtual currencies.

The conference in 2025 specifically pointed out the deficiencies of stablecoins in anti-money laundering, highlighting the regulatory agencies' precise focus on the risks of this particular virtual currency. This targeted regulatory strategy aligns with global regulatory trends, as noted in some research reports, "Financial management departments, such as international financial organizations and central banks, generally adopt a cautious attitude towards the development of stablecoins," and Chinese regulatory agencies also have a clear understanding of this.

The imagination space for stablecoins is infinitely narrowing. In May 2025, Hong Kong's "Stablecoin Ordinance" was officially published and came into effect on August 1, clearly establishing a licensing system for stablecoins. Subsequently, Chinese internet giants such as JD.com and Ant Group have been actively laying out their stablecoin market in Hong Kong. The recent regulatory meeting has directly impacted enterprises' stablecoin layouts in Hong Kong. Analysts believe that although this meeting will not immediately affect the relevant layouts of stablecoins in Hong Kong, speculation on stablecoins in mainland China will be severely cracked down on.

The relevant entities within the territory will subsequently layout stablecoins in Hong Kong, which will significantly limit their imaginative space, more confined to practical application scenarios such as cross-border payments and supply chain finance. Recently, the President of the Hong Kong Monetary Authority, Eddie Yue, emphasized that stablecoins are not tools for investment or speculation but are one of the payment tools utilizing blockchain technology, and they do not have appreciation potential.

He revealed that the licensing for stablecoins in Hong Kong has a relatively high threshold, "We expect to issue at most a few licenses in the initial stage." As regulatory policies continue to tighten, the survival space for covert trading activities of virtual currencies will be further compressed. The meeting required all units to deepen collaboration, improve regulatory policies and legal basis, focus on key areas such as information flow and capital flow, enhance information sharing, and further improve monitoring capabilities.

In the future, buying and selling USDT may no longer be regarded as ordinary violations, but could be classified as "illegal foreign exchange trading" or "aiding information network crimes," which means that regulation has moved from the "risk prevention" phase to the second phase of "criminal governance." From a global perspective, China's regulatory upgrades sharply contrast with the compliance processes in the United States, Hong Kong, and other regions.

As an international financial center, Hong Kong's institutional regulatory path is still advancing at a set pace. With the regulatory boundaries on the mainland becoming clearer, Hong Kong's position as a regional compliance hub in Asia will be further strengthened. The virtual currency industry, under the regulatory storm, is undergoing a test of balancing compliance and innovation.