Bitcoin & Cryptocurrency Regulation in China

In mainland China, Bitcoin and other cryptocurrencies are not legal tender, and trading them or providing crypto services is prohibited. A series of official measures, most prominently a 2017 ban on initial coin offerings and domestic exchanges, a sweeping multi-agency notice in September 2021, and an updated notice in February 2026, classify virtually all crypto-related business activity as illegal financial activity.

One nuance is often misunderstood. Simply owning Bitcoin has generally been treated as a private matter rather than a crime, and some Chinese court rulings have recognised crypto as a form of virtual property. But the activities that make crypto usable, including buying and selling, converting to or from yuan, running a platform, matching trades, or settling them, are off-limits. Equally important, the legal system offers little protection: because contracts tied to prohibited crypto activity can be treated as void, courts will often decline to help if you are scammed or a counterparty disappears. In practice there is no lawful, regulated way to trade crypto inside the mainland.

Hong Kong is different. As a separate jurisdiction it has built a licensing regime for virtual-asset trading platforms and a framework for regulated stablecoin issuers. Those rules are evolving and do not extend automatically to the mainland.

China's approach is a coordinated, multi-agency prohibition rather than a single licensing regulator. The central bank, the People's Bank of China (PBOC), leads policy and directs banks and payment firms to block crypto-related transactions. Its official website is pbc.gov.cn.

The key official notices have been issued jointly by a wide group of authorities, which gives a clear map of who enforces what:

• People's Bank of China (PBOC) - central bank and lead policymaker.
• China Securities Regulatory Commission (CSRC) - securities, token-issuance, and RWA oversight.
• State Administration of Foreign Exchange (SAFE), at safe.gov.cn - cross-border flows and capital controls.
• Ministry of Public Security and the Supreme People's Court and Supreme People's Procuratorate - criminal enforcement.
• Cyberspace Administration of China and the Ministry of Industry and Information Technology - websites, apps, and marketing.
• State Administration for Market Regulation and the banking and insurance supervisors - business registration and financial-institution conduct.

Because enforcement is deliberately shared across these bodies, there is no single crypto-licensing authority on the mainland to apply to.

China has no single dedicated crypto statute. Instead, the regime is built from administrative notices and circulars enforced across agencies, layered on top of existing banking, securities, anti-money-laundering, and foreign-exchange law.

The September 2021 notice

On 15 September 2021 the PBOC and nine other departments jointly issued the Notice on Further Preventing and Resolving the Risks of Virtual Currency Trading and Speculation. It confirmed that virtual currencies are not legal tender, declared crypto-related business activities (fiat-to-crypto and crypto-to-crypto exchange, acting as a counterparty, matching and pricing, token issuance, and derivatives) to be illegal financial activity, and for the first time stated clearly that overseas exchanges serving Chinese residents over the internet are also illegal. You can read the official English text on the People's Bank of China website.

The February 2026 notice

On 6 February 2026 the PBOC, together with seven other regulators, issued an updated notice (reported as the Notice on Further Preventing and Dealing with Cryptocurrencies and Related Risks) that took immediate effect. It reaffirmed the ban and extended it explicitly to the issuance of yuan-linked (RMB) stablecoins, whether inside or outside China, while introducing a separate, approval-based pathway for real-world-asset (RWA) tokenization. These are administrative notices whose exact wording and scope matter, so confirm the current text against official PBOC publications. Informational only, not legal advice.

There is no licence to obtain. Mainland China does not operate a registration or licensing regime for crypto exchanges or virtual-asset service providers, because the underlying activity is banned rather than authorised. The major global platforms that once operated in China withdrew or relocated after 2017 and 2021, and domestic banks and payment apps are instructed to block crypto-related transfers.

The 2021 notice also bars market regulators from registering companies whose names or business scopes reference virtual currency, and prohibits internet firms from offering marketing, advertising, payment, or settlement support, including for offshore platforms that target Chinese residents. The practical result is that any service claiming to be a licensed or regulated mainland crypto exchange should be treated with strong scepticism.

By contrast, Hong Kong runs a separate, genuine licensing regime for virtual-asset trading platforms under its own law. Those rules are distinct from the mainland and should not be assumed to cover mainland residents; verify eligibility directly with licensed Hong Kong providers and regulators.

China does not publish a clear, dedicated personal tax regime for cryptocurrency trading the way some countries do, largely because the underlying trading activity is itself prohibited. There is no consumer-facing framework for individuals to declare ordinary crypto trading gains in the mainland, and you should not assume any specific rate, allowance, or threshold applies.

That absence does not make activity risk-free. Crypto can still intersect with tax and legal exposure, for example where gains are linked to a business, where funds move in ways that draw scrutiny under anti-money-laundering or capital-control rules, or where authorities pursue the proceeds of prohibited activity. The treatment of any given situation can be uncertain and fact-specific.

Do not rely on tax figures you read online. Anyone with a real exposure in China should consult a qualified local tax professional or lawyer and confirm the current rules directly with the relevant authorities. For general background see our guide to crypto taxes. Informational only, not tax advice.

Anti-money-laundering (AML) and foreign-exchange rules are central to how China enforces its crypto ban in practice. Financial institutions and payment companies are barred from opening accounts, transferring funds, settling, or otherwise servicing crypto transactions, and they are expected to monitor for and report suspicious activity. Banks apply standard know-your-customer (KYC) checks, and patterns consistent with crypto trading, such as unusual peer-to-peer transfers, can trigger scrutiny.

Two enforcement themes stand out. First, capital controls: the State Administration of Foreign Exchange (SAFE) monitors cross-border flows and treats the use of crypto to move money out of China as a foreign-exchange and AML concern; see safe.gov.cn. Second, frozen funds: bank accounts linked to crypto-related or over-the-counter (OTC) transfers, including funds later found to be tainted, have been frozen, and the 2026 notice specifically targets yuan-linked stablecoins partly on AML and capital-flight grounds. The realistic takeaway is that converting crypto to or from yuan exposes individuals to account freezes, administrative penalties, and, in serious cases, criminal liability.

There is no licensed, mainland-based exchange where residents can legally buy Bitcoin with yuan, and this section explains the landscape rather than a way around the rules. Domestic exchanges are banned, banks block crypto-related transfers, and OTC or peer-to-peer settlement is an active enforcement focus.

People sometimes attempt access through offshore exchanges, OTC dealers, or peer-to-peer arrangements. These routes carry real risks:

• Legal exposure: facilitating or settling trades can fall foul of the ban, and peer-to-peer fiat settlement has been a specific enforcement target.
• Frozen funds: accounts linked to crypto-related or tainted OTC transfers have been frozen.
• Fraud and counterparty risk: grey-market channels offer little recourse if you are scammed or a platform collapses.
• Capital controls: moving money to fund crypto can collide with strict foreign-exchange limits.

Note that the digital yuan (e-CNY) is not a substitute. It is a state-issued CBDC, not a decentralised cryptocurrency, and holding it is not the same as owning Bitcoin. For broader context on the rules, see our crypto regulation guide.

China was once home to the majority of global Bitcoin mining, but in 2021 authorities moved to shut the industry down, citing financial-risk and energy concerns. Mining was effectively banned, large farms were closed, and operators relocated abroad, which briefly cut the global hashrate by roughly half and redistributed it to other countries.

The picture since has been more complicated. Despite the ban remaining officially in force, underground mining has persisted and, according to reporting in 2025, China's share of global Bitcoin hashrate had rebounded to a meaningful level (estimates put it in roughly the 14 to 20 percent range, again among the world's largest), concentrated in power-rich regions such as Xinjiang and Sichuan. This activity operates outside the law. Beijing has shown no public sign of reversing the prohibition, and anyone considering mining inside the mainland should understand it remains illegal and exposed to enforcement, equipment seizure, and power cut-offs. The rebound reflects weak enforcement in places, not legalisation.

Regulators have continued to close gaps rather than relax. The headline change is the 6 February 2026 notice, in which the PBOC and seven other regulators reaffirmed that crypto-related business activity is illegal and, for the first time, explicitly banned the issuance of yuan-linked (RMB) stablecoins anywhere in the world without approval, while extending scrutiny to offshore platforms serving residents and to peer-to-peer and OTC settlement.

The same framework treats real-world-asset (RWA) tokenization as a distinct category, opening an approval-based, infrastructure-controlled pathway overseen by bodies such as the CSRC and SAFE under a same-business, same-risk, same-rules principle, while keeping decentralised crypto prohibited. Senior officials, including PBOC governor Pan Gongsheng, have publicly stressed strict, total control over private crypto business. Meanwhile the state has pushed its CBDC hard: official data reported the e-CNY processing on the order of 16 trillion yuan cumulatively, and a new e-CNY management framework took effect on 1 January 2026, as covered on China's government portal at english.www.gov.cn. Because these are fast-moving notices, verify the latest position against official sources.

The dominant risk for crypto users connected to mainland China is legal and financial exposure: prohibited activity, blocked or frozen funds, void contracts, and limited recourse through the courts. On top of that sit the universal risks: crypto prices are highly volatile, the market is still maturing, and individual projects can fail.

Scams to watch for

Restrictions and grey markets are fertile ground for fraud. Watch for fake or cloned trading platforms, OTC counterparties who vanish with funds, guaranteed-return schemes and Ponzi structures, phishing that targets wallet credentials or recovery phrases, and pig-butchering romance-investment scams. Never share a wallet seed phrase, treat unsolicited opportunities with suspicion, and remember that the lack of legal protection in this environment makes recovery after a scam especially hard. Because there is no mainland regulator that licenses crypto firms, there is also no official compensation or redress scheme to fall back on. This is not financial advice.

Crypto rules in China are set out in administrative notices that can be updated quickly, so always confirm the current position against primary official sources rather than informal guides. The most authoritative references are:

• People's Bank of China (PBOC), the lead regulator and publisher of the key notices: pbc.gov.cn. The official English text of the 2021 notice is available here.
• State Administration of Foreign Exchange (SAFE), for cross-border and capital-control matters: safe.gov.cn.
• The State Council and government portal, for policy announcements including the e-CNY: english.www.gov.cn.

This page is general information as of 2026 and is NOT legal, tax, or financial advice. Crypto rules are evolving and enforcement is active, so verify the current requirements directly with the People's Bank of China and the other named regulators, or consult qualified local counsel, before acting. For more, see our regulation hub.

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