Legal Status of Virtual Currency Trading in Mainland China
As of September 15, 2026, mainland China enforces a comprehensive ban on virtual currency trading and related activities. This means that within mainland China, there are no government-approved or "legitimate" virtual currency trading platforms, nor are there any legal avenues for residents to participate in virtual currency trading. All platforms claiming to offer such services, whether domestic or international, are considered to be engaged in illegal financial activities.
Regulatory Policy Timeline and Key Points
Since 2021, the Chinese government has progressively clarified and strengthened its regulatory stance on virtual currencies through joint issuances from multiple departments:
- September 2021: The People's Bank of China and nine other departments jointly issued a notice, clarifying that virtual currencies do not have legal tender status and should not be circulated as currency. All virtual currency-related business activities, including exchanges between fiat currency and virtual currency, exchanges between virtual currencies, buying and selling virtual currencies as a central counterparty, providing information intermediary and pricing services, token issuance financing, and virtual currency derivatives trading, are all defined as illegal financial activities and are required to be strictly prohibited and shut down according to law.
- Ban on Overseas Services: The notice also clarified that overseas virtual currency exchanges providing services to Chinese residents via the internet also constitute illegal financial activities. Domestic personnel providing marketing, payment and settlement, and technical support services to these overseas institutions will face legal liability.
- May 31, 2025: The Chinese government officially implemented a comprehensive ban on cryptocurrency trading and mining, covering major cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH).
- November 28, 2025: The People's Bank of China, leading 13 departments, reiterated that virtual currency-related businesses are illegal financial activities and for the first time clarified the definition of stablecoins.
- February 2026: The People's Bank of China and seven other departments again jointly issued a document, further emphasizing the illegality of virtual currency-related business activities and reiterating their strict prohibition within the country.
Legal Status and Risks of Virtual Currencies
In mainland China, virtual currencies such as Bitcoin, Ether, and USDT do not have the same legal status as fiat currency, do not have legal tender status, and should not and cannot be circulated and used as currency in the market. Participating in virtual currency trading and speculation activities carries multiple risks:
- Property Safety Risks: Virtual currency trading activities disrupt economic and financial order, easily breed illegal and criminal activities such as gambling, illegal fundraising, fraud, pyramid schemes, and money laundering, seriously endangering residents' property safety.
- Legal Risks: Any legal person, unincorporated organization, or natural person investing in virtual currencies and related derivatives may face property losses, and related legal actions are not protected by law. In some cases, participants may even face prosecution for illegal business operations, aiding information network criminal activities, or money laundering.
Risks of Over-the-Counter (OTC) Trading
Although over-the-counter (OTC) trading of virtual currencies was previously considered personal buying and selling of virtual goods in some judicial practices, its legality has become highly controversial with the tightening of regulatory policies. Especially when OTC transactions involve large sums of money or are linked to funds from criminal activities such as telecommunication fraud or online gambling, traders face extremely high legal risks.
Essential Differences Between Digital Yuan (e-CNY) and Virtual Currencies
It is important to note that the Digital Yuan (e-CNY) issued by the People's Bank of China is a digital form of legal tender, backed by state credit, and fundamentally different from virtual currencies. The Digital Yuan is a centralized sovereign currency, aiming to improve payment convenience, security, and anti-counterfeiting capabilities; while virtual currencies are decentralized "virtual assets" with volatile prices and a lack of stable value foundation.
Conclusion
Given mainland China's strict prohibition policy on virtual currency trading, there are currently no "legitimate domestic virtual currency trading platforms" or "currently usable virtual currency platforms." Any platform claiming to offer such services is illegal, and participating in them carries significant legal and property risks. All readers, especially residents of mainland China, are advised to strictly abide by local laws and regulations and stay away from virtual currency trading activities to protect their property safety.
