This Friday, the crypto crackdown in China intensified through a joint notice issued by eight national agencies, including the People’s Bank of China. The new guidelines not only reaffirm the 2021 ban on digital asset trading but also expand the veto to stablecoins and tokenization of assets.
According to the official statement, authorities seek to curb financial speculation which, in their view, threatens yuan stability and monetary control. However, this regulatory update emphasizes that any cross-border activity with crypto assets is illegal, directly affecting foreign entities operating within Chinese territory or targeting its citizens.
The regulatory siege on stablecoins and digital yuan sovereignty
The recent announcement places special emphasis on stablecoins, arguing that these currencies replicate sovereign functions and facilitate large-scale money laundering. Therefore, no entity may issue assets linked to the renminbi abroad without prior government approval, imposing strict control over national financial sovereignty and capital flows.
Likewise, the crypto crackdown in China now covers the tokenization of real-world assets, a growing trend in global capital markets recently. In this regard, the government requires that any firm wishing to digitize stocks or real estate must comply with extremely rigorous compliance standards, effectively limiting all operational exceptions.
What impact will this measure have on the global asset market?
Beijing’s decision represents a major milestone as it closes loopholes that allowed local companies to tokenize assets in various international jurisdictions. In this way, the regulator seeks to prevent capital flight, since tokenization could be used to evade exchange controls that govern the national economy strictly.
Moreover, the reiteration of the veto on assets such as Bitcoin and Tether confirms that China does not plan to relax its policy. Additionally, the scrutiny of overseas branches of Chinese firms suggests that state surveillance will transcend physical borders to monitor every digital financial movement and transaction performed abroad.
Ultimately, the tightening of these rules highlights the country’s determination to prioritize its sovereign digital currency over private alternatives today. However, the effectiveness of these bans will depend on the technical capacity of security agencies to track operations in global distributed infrastructures, which often operate beyond government reach.
As the ecosystem evolves, the market must adapt to a China that sees decentralization as an unacceptable systemic risk for its model. Therefore, institutional investors could begin to divert their flows toward more permissive financial centers, reconfiguring the map of technological innovation within the global financial sector.
