China Reinforces Crypto Ban, Maps Rules for Real-World-Asset Tokens
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The regulatory reinforcement follows a surge in market discussion about virtual assets in the second half of 2025. Photo: VCG
cryptocurrencies and, for the first time, outlined a regulatory framework for the tokenization of real-world assets, signaling a more proactive approach to managing risks from emerging financial technologies.
In a notice dated Feb. 6, the People’s Bank of China and seven other government bodies reiterated that all virtual-currency-related business activities constitute illegal financial activity. The rules explicitly prohibit any domestic or foreign entity from issuing stablecoins pegged to the yuan overseas without regulatory approval.
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- China reaffirmed its strict ban on all cryptocurrency activities and prohibited issuance of yuan-pegged stablecoins and virtual currencies without approval, both domestically and overseas.
- For the first time, China defined and implemented a regulatory framework for real-world-asset (RWA) tokenization, supervised by the China Securities Regulatory Commission.
- The move follows high-profile fraud cases, such as a $1.9 billion Tether scheme, and ongoing regulatory warnings against crypto activities.
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Who’s Who
- DGCX
- The article mentions DGCX in the context of a cited fraud case. Authorities stated that DGCX allegedly used the U.S. dollar-pegged stablecoin Tether in an illegal fundraising scheme in June 2025. This scheme reportedly defrauded approximately 2 million investors of 13 billion yuan ($1.9 billion).
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What Happened When
- 2021：
- A landmark document effectively outlawed cryptocurrency trading and mining on the Chinese mainland.
- June 2025：
- A platform known as DGCX allegedly used the U.S. dollar-pegged stablecoin Tether in an illegal fundraising scheme, defrauding about 2 million investors of 13 billion yuan ($1.9 billion).
- Second half of 2025：
- A surge in market discussion about virtual assets led regulators to issue multiple public warnings and vow continued crackdowns on cryptocurrency trading and speculation.
- Feb. 6, 2026：
- The People’s Bank of China and seven other government bodies issued a notice reiterating that all virtual-currency-related business activities constitute illegal financial activity, and outlined new rules on the tokenization of real-world assets.
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