Overview of Cryptocurrency Regulation in Mainland China
Since September 2021, multiple departments, including the People's Bank of China (PBOC), have jointly issued notices explicitly classifying virtual currency-related business activities as illegal financial activities, comprehensively prohibiting virtual currency trading and related services. This policy has had a profound impact on the cryptocurrency market in mainland China, leading to the closure of all domestic virtual currency trading platforms. Subsequently, regulatory authorities have continuously tightened control over virtual currency trading, and in November 2025, they further reiterated their stance against virtual currency trading and speculation, explicitly stating for the first time that stablecoins (such as USDT) are also a form of virtual currency and pose risks such as money laundering and fundraising fraud.
Although the Shanghai Higher People's Court pointed out in November 2024 that "individuals simply holding virtual currency is not illegal in itself," it also emphasized that trading activities involving cryptocurrencies may disrupt financial order, violate public order and good morals, and related trading contracts may be deemed invalid. This means that while holding crypto assets itself does not constitute a violation, any form of trading activity may face legal risks and asset losses.
USDT Trading Channels and Potential Risks
Under strict regulatory environments, it is no longer possible for mainland Chinese residents to conduct USDT transactions through traditional compliant channels. However, some users may still attempt to trade through the following unofficial or high-risk channels:
- Overseas International Cryptocurrency Trading Platforms: Binance, OKX, HTX (formerly HTX Global) and other international platforms have explicitly withdrawn from the mainland Chinese market, but their international sites may still provide USDT buying and selling channels for some Chinese users through P2P (peer-to-peer) trading services. Users typically need to use Virtual Private Network (VPN) services to access these platforms to circumvent geographical restrictions.
- Over-the-Counter (OTC) Trading: Some users may conduct USDT transactions through informal over-the-counter channels, usually involving direct fiat-to-crypto exchanges between individuals.
However, all the aforementioned trading methods come with extremely high risks:
- Legal and Compliance Risks: Providing services to residents in mainland China by overseas exchanges constitutes illegal financial activity. Users participating in such transactions may be deemed to be engaged in illegal business operations or suspected of criminal activities such as money laundering, facing criminal liability.
- Asset Freezing Risk: Bank accounts involved in cryptocurrency transactions, especially those with large or frequent transactions, are highly susceptible to being frozen by banks or judicial authorities due to suspected illegal transactions or money laundering.
- Fund Security Risk: Unofficial over-the-counter transactions lack supervision and guarantees, and users may face risks of fraud, fund theft, or irrecoverable transaction disputes.
- Policy Uncertainty: Regulatory policies may be adjusted at any time, further tightening restrictions on cryptocurrency transactions, leading to the closure of existing trading channels or an increase in risks.
Conclusion and Risk Warning
Given mainland China's comprehensive ban on virtual currency transactions and continuous high-pressure regulation, there are currently no officially recognized or legally protected USDT trading platforms. Any trading platform or channel claiming to be "available domestically" carries enormous legal and financial risks. For residents of mainland China, participating in USDT and other virtual currency transactions may not only lead to asset losses but also potential legal repercussions. All users are advised to strictly abide by local laws and regulations, stay away from illegal financial activities, carefully assess and avoid related risks.
