About the current policies in the country: U merchants, withdrawal, and deposit issues
According to the current laws and regulations in mainland China, the legal boundaries for such activities are very clear.
Virtual currency-related business activities are not recognized as legal financial activities and are strictly prohibited.
Illegal virtual currency trading: Based on current policies, any form of virtual currency exchange, trading, or acting as a central counterparty to buy and sell virtual currencies is considered illegal financial activity.
Providing related services is prohibited: Providing information intermediary, pricing services, exchange services for virtual currency trading, referred to as "U merchants," as well as services such as fund transfers, settlement, and clearing, are also prohibited.
Under a strict regulatory framework, any financial dealings involving virtual currencies face extremely high risks:
Fund freezing: Financial institutions are obligated to monitor abnormal transactions. Card transactions involving virtual currency trading are easily identified as risky transactions, which may lead to account restrictions on non-counter transactions, limits, or even freezing.
Suspected criminal activity: Using virtual currencies for cross-border fund transfers may be deemed illegal foreign exchange trading. In severe cases, criminal liability may arise due to illegal business operations, among other charges. There have been relevant judicial precedents.
Although the convenience of personal bank deposits and withdrawals and cross-border remittances has improved, the financial system's risk control has not relaxed. The following are two key new regulations that will take effect soon (effective January 1, 2026):
1. Large cash deposits and withdrawals
The rigid requirement of "registering the source and purpose of funds for cash deposits or withdrawals exceeding 50,000 yuan" has been canceled.
Banks will conduct risk-oriented due diligence. This means that normal transactions may simplify the process, but for abnormal transactions, banks will still verify the source and purpose of funds.
2. Cross-border remittances
When processing a single cross-border remittance equivalent to more than 1,000 US dollars, financial institutions must verify the remitter's name, account number, and other core identity information.
This regulation is an anti-money laundering measure and does not change the annual foreign exchange purchase limit of 50,000 US dollars for individuals. The focus is on ensuring that transaction information is true and accurate, preventing illegal cross-border movement of funds.
In summary, engaging in or participating in activities such as "U merchants," withdrawals, and deposits involving virtual currencies domestically carries clear legal and financial risks. Individuals should fully understand the relevant policies to avoid participating in such activities to protect their property security. #热门话题
