China is establishing strict restrictions against the issuance and circulation of Renminbi (RMB)-backed stablecoins. The People’s Bank of China and the National Financial Regulatory Administration published an official warning prohibiting stablecoin activities within the country.
The Asian nation, that had imposed a blanket ban on crypto activities in 2021, has observed a spike in international activities including RMB-backed stablecoins.
It has directed all national and international entities to not issue or distribute RMB-pegged stablecoins. Any company or individual considering a launch of such a token will first have to make a case before the People’s Bank of China and other financial regulators for clearance.
“These activities pose significant risks, including money laundering, fraud, illegal cross-border capital flows, and threats to China’s financial order and the international status of the RMB,” the notice issued by a total of seven Chinese government ministries said.
China has clearly instructed domestic financial institutions to immediate prohibit service provisions to administrators of unapproved stablecoins.
“The Renminbi is the only legal currency of the People’s Republic of China. No organization or individual may issue or circulate digital tokens or ‘stablecoins’ to replace the RMB in the market,” the statement noted. “Any issuance, exchange, or providing of settlement services for RMB-pegged stablecoins without approval from Chinese financial authorities is considered an illegal financial activity and is strictly prohibited.”
The country has been ramping up efforts to crackdown on illegal crypto and stablecoin operations since last year.
In August 2025, China’s financial authorities had started clamping down on local brokers and study groups that were identified as conducting research work and seminars advocating stablecoins.
In December, the People’s Bank of China had reiterated that digital assets are not seen as legal tenders in the country and that they must not, in any way, be integrated with the national financial ecosystem. The Chinese central bank had particularly pointed out that stablecoins do not meet the national legal standards around customer identification and anti-money laundering rules.
China’s completely opposite trajectory on stablecoins and crypto from the U.S. often make it to the headlines.
Earlier in January this year, U.S. President Donald Trump claimed that keeping crypto away from China is among reasons why he has been pushing his government to make the U.S. a lucrative ecosystem for crypto firms to set up shops in.
As China continues to remain hostile towards digital assets, the U.S. not only passed its stablecoin-focussed GENIUS Act but is also pacing to finalize its crypto market structure bill.
U.S. SEC chief Paul Atkins said on Friday that the crypto market structure bill — or the CLARITY Act — is aimed at setting clear user protection and industry-friendly collaboration between the SEC and the CFTC in the U.S. — that will eventually contribute to make the U.S. the crypto capital of the world, as envisioned by President Trump.
The EU, the UAE, South Korea, Thailand, and Russia are other nations that are taking efforts to take the “regulate over restrict” approach towards the crypto industry.