Current State of Virtual Currency Trading Regulation in Mainland China
Since 2021, mainland China has adopted and continuously strengthened a strict regulatory stance, implementing a comprehensive ban on virtual currency trading and related business activities. Multiple departments, including the People's Bank of China (PBOC), have repeatedly issued joint notices, clarifying that virtual currencies do not possess legal tender status and that any virtual currency-related business activities are deemed illegal financial activities. This includes, but is not limited to, virtual currency trading, exchange, issuance, financing, and providing services to overseas virtual currency exchanges.
Specifically, in September 2021, the People's Bank of China (PBOC) and nine other departments jointly issued a notice to comprehensively prohibit services related to virtual currency settlement and providing trader information, and also deemed overseas virtual currency exchanges providing services to residents in mainland China via the internet as illegal financial activities. Furthermore, cryptocurrency mining activities are also strictly restricted and prohibited.
On February 6, 2026, the People's Bank of China (PBOC) and seven other departments once again jointly issued the "Notice on Further Preventing and Disposing of Risks Related to Virtual Currencies," reaffirming and updating previous prohibitions. The notice emphasized that overseas entities and individuals are not allowed to illegally provide virtual currency-related services to domestic entities in any form, and without consent, domestic entities and their controlled overseas entities are not allowed to issue virtual currencies or RMB-pegged stablecoins overseas. Market regulatory authorities have also strengthened the management of business entity registration, prohibiting enterprises and individual industrial and commercial households from including terms such as "virtual currency" in their registered names and business scopes.
The main reasons for the Chinese government's actions include maintaining financial stability, preventing illegal fundraising, fraud, money laundering, and other criminal activities, reducing energy consumption from cryptocurrency mining, and eliminating potential competition for the promotion of the digital RMB. Therefore, within mainland China, there are currently no legally operating virtual currency trading platform addresses. Any platform claiming to operate legally in mainland China is illegal.
Overview of International USD Virtual Currency Trading Platforms
"USD virtual currency software" typically refers to international cryptocurrency trading platforms or related applications that support the US dollar (USD) as a trading pair. These platforms operate globally, providing users with various cryptocurrency-to-USD exchange and trading services. They typically offer the following features:
- Diversified Trading Products: Including spot trading, futures trading, options, margin trading, and cryptocurrency ETFs.
- Extensive Coin Support: Offering trading for mainstream cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), and numerous altcoins.
- Security Measures: Most platforms emphasize the use of cold wallet storage, multi-signature technology, crime insurance, and regular reserve audits to ensure the security of user assets.
- Global User Base: Providing services to global users, but operating in compliance with regulations in different countries and regions, so service availability may be geographically restricted.
Some well-known international cryptocurrency trading platforms, such as Coinbase, Kraken, OKX, Binance, Gate.io, Bybit, Crypto.com, and Gemini, all support USD trading. These platforms typically require users to complete Know Your Customer (KYC) verification processes and comply with the regulatory requirements of their operating locations.
Risks Faced by Mainland Chinese Residents Participating in International Platforms
Although international platforms offer USD virtual currency trading services, mainland Chinese residents face significant legal and asset security risks when participating in virtual currency trading activities.
- Legal Risks: According to mainland Chinese laws and regulations, any virtual currency-related business activity is an illegal financial activity. Mainland Chinese residents trading virtual currencies through overseas platforms may be deemed to be participating in illegal financial activities.
- Asset Security Risks: Overseas platforms may have compliance uncertainties, technical vulnerabilities, or operational risks. In the event of an exit scam, theft, or collapse of a platform, it will be difficult for mainland Chinese residents to protect or recover their assets through legal channels.
- Capital Inflow and Outflow Risks: Capital inflow and outflow involving fiat currency and cryptocurrency exchange may touch upon foreign exchange control policies, or even be deemed illegal activities such as money laundering, leading to frozen funds or legal sanctions.
Given the above risks, mainland Chinese residents should strictly abide by local laws and regulations and be wary of any platforms or individuals claiming to circumvent regulations or provide "gray channels." Investing in virtual currencies carries high risks and is an illegal activity in mainland China. Please fully understand and bear all potential risks yourself.
