<div id="readability-page-1"><div><div>Article IntroductionThe four-year-long crackdown on cryptocurrencies in mainland China has not subsided; instead, it has demonstrated a more precise crackdown strategy at the end of 2025.In September 2021, the People's Bank of China and ten other departments jointly issued the &#34;Notice on Further Preventing and Handling Risks of Virtual Currency Trading and Speculation&#34; (Document No. 237), which for the first time explicitly stated that virtual currency-related business activities belong toillegal financial activities, establishing my country's strict regulatory tone for virtual currencies.. Four years later, on November 28, 2025, the People's Bank of China convened another meeting of the coordination mechanism for combating speculation in virtual currencies. Thirteen departments attended, emphasizing the continued adherence to the prohibitive policy towards virtual currencies. Four years between these two important meetings, China's virtual currency regulatory strategy has evolved from an initial comprehensive definition and prohibition to a more precise and in-depth crackdown system. From Ten Departments to Thirteen Departments Working Together The most significant difference between the regulatory actions in 2021 and 2025 lies in the increased number of participating departments. The 2021 &#34;Notice&#34; was jointly issued by ten departments, including the People's Bank of China, while the 2025 meeting expanded to include relevant officials from thirteen departments, including the Ministry of Public Security, the Cyberspace Administration of China, the Central Financial Affairs Commission, 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 reflects an upgrade in regulatory strategies. The 2021 regulatory framework primarily focused on finance, internet information, and market regulation, while the 2025 framework incorporates more law enforcement and macro-management departments. This change reflects that China's assessment of the risks of cryptocurrency speculation has expanded from purely financial risks to broader socio-economic security risks. The 2025 meeting clearly stated: &#34;We will take risk prevention and control as the eternal theme of financial work, continue to adhere to the prohibitive policy on virtual currencies, and continuously crack down on illegal financial activities related to virtual currencies.&#34; This indicates that after four years of practice, virtual currency regulation has become a regular component of China's financial risk prevention and control, rather than a temporary or campaign-style rectification action. The 2021 &#34;Notice&#34; comprehensively defined mainstream virtual currencies such as Bitcoin, Ethereum, and Tether, clarifying that they &#34;do not have the same legal status as fiat currency.&#34; The 2025 meeting, while continuing this tone, publicly defined stablecoins for the first time. The meeting explicitly pointed out that &#34;stablecoins are a form of virtual currency, and currently cannot effectively meet the requirements for customer identification and anti-money laundering, posing a risk of being used for illegal activities such as money laundering, fundraising fraud, and illegal cross-border fund transfers.&#34; This signifies that Chinese regulatory authorities have a more refined and in-depth understanding of the risks associated with virtual currencies. Stablecoins, as a type of virtual currency that attempts to be pegged to the value of fiat currency, have developed rapidly globally in recent years. However, their so-called &#34;stability&#34; does not change their essential nature as virtual currencies. The 2025 conference specifically pointed out the shortcomings of stablecoins in anti-money laundering, demonstrating the regulators' precise focus on the risks of this specific type of virtual currency. This targeted regulatory strategy aligns with global regulatory trends. As some research reports have noted, &#34;international financial organizations and central banks, among other financial regulatory bodies, generally hold a cautious attitude towards the development of stablecoins,&#34; and Chinese regulators are also clearly aware of this. The potential for stablecoins is increasingly limited. In May 2025, Hong Kong's Stablecoin Ordinance was officially gazetted and came into effect on August 1st, clearly establishing a stablecoin licensing system. Subsequently, Chinese internet giants such as JD.com and Ant Group have been reported to be actively developing stablecoins in Hong Kong. This regulatory meeting has directly impacted companies' stablecoin deployments in Hong Kong. Analysts believe that while the meeting will not immediately affect stablecoin deployments in Hong Kong, it will severely crack down on stablecoin speculation in mainland China. The potential for mainland entities to deploy stablecoins in Hong Kong will be significantly reduced, limiting their applications to practical scenarios such as cross-border payments and supply chain finance. Recently, Eddie Yue, Chief Executive of the Hong Kong Monetary Authority, emphasized that stablecoins are not investment or speculative tools, but rather payment tools utilizing blockchain technology, and do not inherently possess appreciation potential. He revealed that the licensing of stablecoins in Hong Kong has a fairly high threshold, and &#34;we expect that at most only a few licenses will be issued in the initial stage.&#34; As regulatory policies continue to tighten, the space for covert virtual currency transactions will be continuously compressed. The meeting required all units to deepen coordination and cooperation, improve regulatory policies and legal basis, focus on key links such as information flow and capital flow, strengthen information sharing, and further enhance monitoring capabilities. In the future, buying and selling USDT may no longer be considered a simple violation, but could be classified as &#34;illegal foreign exchange trading&#34; or &#34;aiding and abetting cybercrime.&#34; This signifies that regulation is moving from &#34;risk prevention&#34; to the second stage of &#34;criminalized governance.&#34; From a global perspective, China's regulatory upgrade contrasts sharply with the compliance processes in the United States and Hong Kong. As an international financial center, Hong Kong's institutionalized regulatory path continues to advance at its established pace. As the boundaries of mainland regulation become clearer, Hong Kong's position as a regional compliance hub in Asia will be further strengthened. The cryptocurrency industry, under regulatory scrutiny, is undergoing a test of balancing compliance and innovation.</div></div></div>

CRCL

Over the past four years, China's regulatory stance on cryptocurrencies has evolved from a broad prohibition to a more precise crackdown. In 2021, ten departments, including the People's Bank of China, issued a notice defining virtual currencies as illegal financial activities. By 2025, thirteen departments, including law enforcement, emphasized continued prohibition and highlighted risks associated with stablecoins. This shift reflects a broader focus on socio-economic security risks and aligns with global regulatory trends.

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