Chinese regulators have issued a new joint notice reinforcing their hardline stance on cryptocurrencies, with particular emphasis on banning the issuance of stablecoins, as eight departments, including the People’s Bank of China and the China Securities Regulatory Commission, move to address renewed risks from virtual asset speculation and real-world asset tokenization.
Building on the 2021 crackdown, the notice reiterates that virtual currencies, including stablecoins such as Tether, have no legal tender status and that related business activities constitute illegal financial activities. It stresses that stablecoins pegged to legal tender perform currency-like functions and therefore implicate monetary sovereignty, making them subject to strict state control.
Under the new rules, without lawful approval from relevant authorities, no domestic or overseas entity or individual may issue stablecoins pegged to the renminbi overseas, and domestic firms are prohibited from participating in or facilitating such activities through overseas affiliates.
Regulators said the unauthorized issuance and related services could expose the financial system to money laundering, fraud, and cross-border capital risks, and undermine national financial security.
The notice also strengthens oversight of financial, intermediary, and technology service providers, requires tighter compliance and internal controls, and establishes a coordinated enforcement framework between central and local authorities.
Officials said regulators will intensify monitoring of capital and information flows, crack down on illegal issuance and promotion, and expand public education efforts to ensure strict implementation of the stablecoin ban and safeguard monetary stability.
This is a developing story. Please come back for further updates.
Source: https://cryptobriefing.com/china-yuan-linked-stablecoin-ban/
