Are cryptocurrencies illegal in China?
In China, the legal status and regulatory environment of cryptocurrencies and digital currencies are relatively complex. Here are some key points about the legal and regulatory landscape of cryptocurrencies in China:
2013 "Notice on Preventing Bitcoin Risks": Seven departments including the People's Bank of China issued this notice, prohibiting financial institutions from conducting Bitcoin-related businesses and requiring financial institutions not to circulate Bitcoin as currency.
ICO ban in 2017: The China Securities Regulatory Commission issued a notice prohibiting any form of initial coin offering (ICO) financing activities, requiring refunds from ICO projects that have been carried out, and stopping all related promotional activities.
Cryptocurrency Exchange Clampdowns in 2021: The Chinese government has tightened regulations on cryptocurrency exchanges, requiring the closure of domestic cryptocurrency trading platforms and banning cryptocurrency trading by residents within the country. Additionally, China has also restricted cryptocurrency mining activities.
The purpose of these regulatory measures is to maintain financial order, prevent financial risks and protect the interests of investors. The Chinese government is concerned about the volatility of the cryptocurrency market, potential money laundering and illicit financing risks, and potential threats to financial stability. As a result, the government has taken a series of measures to restrict cryptocurrency activities in China.
It should be noted that the concepts and technologies of cryptocurrency and digital currency themselves are not illegal, but in China, related transactions and business activities are subject to strict regulatory restrictions. Therefore, Chinese citizens and enterprises should abide by relevant laws and regulatory policies and be cautious in participating in cryptocurrency-related activities to avoid breaking the law or suffering risks.