Overview of the Current Status of Virtual Currency Trading Platforms in Mainland China
Since September 2021, Mainland China has adopted a policy of comprehensive prohibition on virtual currency trading and related business activities. This means that there are currently no officially recognized or legally operating virtual currency trading platforms within Mainland China. All services that provide exchange between fiat currency and virtual currency, exchange between virtual currencies, or act as a central counterparty for buying and selling virtual currencies, are explicitly identified as illegal financial activities and are to be banned according to law.
Even overseas virtual currency exchanges that provide services to Mainland Chinese residents via the internet are similarly considered illegal financial activities. This policy framework was continuously reiterated and strengthened in 2025 and 2026, with departments such as the People's Bank of China (PBOC) repeatedly emphasizing that virtual currencies do not have legal tender status and continuing to crack down on related illegal activities.
Regulatory Policies and Legal Framework
- Comprehensive Prohibition of Virtual Currency-Related Business Activities: Ten departments, including the People's Bank of China (PBOC), issued a notice on September 24, 2021, classifying virtual currency-related business activities as illegal financial activities and demanding their strict prohibition. This includes token issuance financing, virtual currency derivatives trading, etc.
- Property Attributes of Virtual Currencies: Despite the prohibition of trading activities, Mainland Chinese courts generally hold that cryptocurrencies have economic value and are virtual property protected by law. For example, the Songjiang District People's Court in Shanghai confirmed in a November 2024 ruling that Chinese citizens can legally hold cryptocurrencies as personal virtual property.
- Continuously Escalating Regulation: Regulatory authorities continue to focus on the risks posed by virtual currencies, especially money laundering and cross-border capital transfers. In November 2025, a People's Bank of China (PBOC) meeting marked stablecoin activities as the next enforcement target. In February 2026, eight departments, including the People's Bank of China (PBOC), jointly issued another notice, reiterating that virtual currencies do not have legal tender status, all related domestic business is prohibited, and responsibility will be pursued for illegal services provided from overseas.
Risks Faced by Mainland Chinese Users
Due to the absence of legal trading channels within the country, some Mainland Chinese users may attempt to access overseas exchanges or conduct peer-to-peer (P2P) transactions via virtual private networks (VPNs). However, these actions are accompanied by significant legal and financial risks:
- Legal Risks: The use of VPNs itself may be in a legal gray area. Users participating in illegal financial activities provided by overseas exchanges may face legal liability.
- Financial Risks: P2P transactions may lead to frozen bank accounts or even involvement in money laundering or fraud cases. If overseas exchanges cease services or restrict withdrawals due to regulatory pressure, users' asset security will be threatened.
- Technical Risks: Accessing unauthorized platforms or using unofficial channels may increase the risk of encountering phishing, malware, or platform security vulnerabilities.
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Hong Kong's Compliance Development
Unlike Mainland China's strict prohibitions, the Hong Kong Special Administrative Region has adopted a different regulatory path for virtual asset trading platforms. Since 2023, Hong Kong has implemented a licensing regime for virtual asset trading platforms, allowing licensed exchanges to provide services to retail investors. Currently, platforms such as OSL Exchange, HashKey Exchange, and HKVAX have obtained relevant licenses and operate within a compliant framework.
Global Regulatory Overview
As of the time of writing, 51 countries and regions worldwide have issued prohibitions on crypto assets, demonstrating different strategies among countries in balancing financial innovation and risk control. The global crypto asset market capitalization reached $1.55 trillion at the end of 2023, indicating a vast market size, but the regulatory environment is complex and constantly evolving.
Conclusion
For residents of Mainland China, participating in virtual currency trading activities carries clear legal risks and financial security concerns. Users are strongly advised to comply with local laws and regulations and be wary of illegal financial activities. For investors who wish to engage with blockchain technology or digital assets, compliant alternatives may include investing in blockchain-related stocks or funds, or paying attention to the progress of China's central bank digital currency (DCEP).
