Review of Cryptocurrency Trading Regulatory Policies in Mainland China
Since September 2021, mainland China has implemented a comprehensive ban on cryptocurrency trading and related businesses. Ten departments, including the People's Bank of China (PBOC), jointly issued a notice explicitly stating that all virtual currency-related business activities, including virtual currency exchange, trading matching, token issuance financing, and derivative trading, are illegal financial activities. The notice also emphasized that overseas virtual currency exchanges providing services to Chinese residents via the internet are also considered illegal financial activities. This series of measures marked China's entry into a comprehensive cleanup phase for cryptocurrency regulation.
Prior to this, the Chinese government had issued relevant bans in 2013 and 2017, but the 2021 policy is the strictest and most comprehensive to date. Regulators believe that cryptocurrency trading speculation disrupts economic and financial order and may foster illegal criminal activities such as gambling, illegal fundraising, fraud, pyramid schemes, and money laundering. Therefore, virtual currencies do not possess the legal status of legal tender and should not and cannot be circulated and used as currency in the market.
HTX and Other Mainstream Platforms Exit Mainland China Market
In response to mainland China's regulatory policies, HTX Global (Huobi Global), which once dominated the Chinese market, stopped new user registrations in mainland China on September 24, 2021. Subsequently, HTX planned to complete the orderly exit of existing users with mainland China identity verification before 24:00 on December 31, 2021. The specific exit process included: closing deposit functions on December 14, 2021; prohibiting spot trading functions on December 15; and delisting OTC (over-the-counter) CNY trading on December 31. Withdrawal functions were retained for one to two years.
In addition to HTX, other major trading platforms such as Binance (Binance) and OKX (OKX) also announced their withdrawal from the mainland China market by the end of 2021 and conducted a review of mainland Chinese users, switching accounts to "withdrawal-only" mode. Bitget, KuCoin, MEXC, and other platforms also issued exit announcements for mainland Chinese users, with most deadlines set for December 31, 2021.
Mainland Chinese Users and Overseas Trading Platforms
Despite the extremely strict regulatory policies in mainland China and the completion of exits by major trading platforms, some mainland Chinese users still access and use overseas cryptocurrency trading platforms through various means. However, it is important to emphasize that this behavior carries significant legal and compliance risks. Mainland Chinese law explicitly prohibits all virtual currency-related business activities, and individual participation in overseas platform transactions may also be deemed illegal financial activities. Users must fully understand and assess relevant risks before participating.
Overseas Trading Platforms of Interest to Chinese Users
Below are some overseas cryptocurrency trading platforms that operate globally and may be of interest to Chinese users. These platforms have all exited the mainland China market and comply with local laws and regulations. Users should verify the legal compliance of their chosen platform in their respective jurisdictions.
- OKX (OKX): As one of the world's leading cryptocurrency trading platforms, OKX offers diversified trading products such as spot and futures, and actively develops the Web3 ecosystem, including decentralized wallets and NFT marketplaces.
- Binance (Binance): Binance is one of the world's largest cryptocurrency exchanges by trading volume, offering a wide selection of cryptocurrencies, low trading fees, and a comprehensive crypto ecosystem including Launchpad, liquidity mining, and staking.
- HTX (formerly Huobi): As a veteran digital currency trading platform, HTX provides digital asset trading services globally, known for its technological strength and user experience.
- Gate.io: Founded in 2013, Gate.io is known for its technical stability and security, offering a rich selection of altcoins and diverse trading products.
- Bybit: Bybit has significant advantages in derivatives trading, offering an intuitive trading interface and a wide range of futures products, favored by many derivatives traders.
- Bitget: Bitget offers various digital currency trading services, including spot and futures trading, and is noted by some users for its copy trading feature.
- KuCoin: KuCoin has a broad user base globally, offering diversified cryptocurrency trading services, including spot, futures, margin, and staking.
- Bitfinex: Bitfinex is a long-established exchange that supports various virtual currency transactions, attracting professional investors with its professional trading tools and deep liquidity.
- MEXC: MEXC is committed to providing secure and convenient digital asset trading services, with a diverse range of trading pairs and an active community.
Please note that the platforms listed above no longer provide trading services to residents of mainland China. Users should fully understand and comply with local laws and regulations and remain vigilant about potential investment risks before participating in cryptocurrency trading in any jurisdiction.
