Cryptocurrency trading is subject to significant regional regulatory differences worldwide. For global investors, especially Chinese-speaking readers, understanding the current policy landscape in different jurisdictions is crucial. This article will focus on relevant policies in mainland China and Hong Kong, and provide compliance advice from a global perspective.
Mainland China: The Current Situation Under Strict Prohibitions
Mainland China has adopted one of the strictest regulatory measures globally for cryptocurrency trading. In 2017, the Chinese government first halted Initial Coin Offerings (ICOs) and ordered the closure of domestic cryptocurrency trading platforms. By September 2021, regulations tightened further, with the People's Bank of China and nine other departments jointly issuing a notice explicitly defining virtual currency-related business activities as "illegal financial activities." This means:
- Any virtual currency exchange, buying and selling, intermediary, pricing, or information intermediary services within China are prohibited.
- Overseas virtual currency exchanges providing services to mainland Chinese residents via the internet also constitute illegal financial activities.
Therefore, as of now, there are no legal and compliant virtual currency trading platforms available for operation or download within mainland China. Global exchanges that once operated in the Chinese market have all announced their withdrawal from mainland China or ceased providing services to users in the region.
Legal Risks and Asset Attributes
Despite the strict prohibition on trading, the mere holding of cryptocurrencies itself is a matter of legal dispute in practice. Some Chinese courts, in individual cases (such as a 2019 ruling by the Hangzhou Internet Court), have recognized Bitcoin as a "virtual commodity" with property attributes. However, this recognition is not widespread, and assets, once damaged due to trading, theft, or platform issues, are difficult to fully protect under the law. Overall, personal holding of cryptocurrencies in mainland China exists in a legal gray area, without explicit legal protection.
Participating in any form of trading, including through overseas platforms or unofficial channels, carries risks of asset loss, account freezing, and violations of administrative regulations or even criminal laws. Investors must be clearly aware of these risks.
Hong Kong's Independent Regulatory Framework
Unlike the mainland, the Hong Kong Special Administrative Region has an independent judicial and financial regulatory system. The Securities and Futures Commission (SFC) of Hong Kong has established a licensing regime for virtual asset trading platforms. As of early 2026, a few platforms, including OSL and HashKey Exchange, have obtained licenses and can legally provide trading services to retail and institutional investors in Hong Kong.
This framework in Hong Kong offers an option for investors seeking to trade cryptocurrencies in a regulated environment, but investors still need to ensure they meet the user eligibility requirements for the region.
Compliance Paths for Global Investors
For global investors, the primary consideration when choosing a trading platform is its compliance in their own jurisdiction. Mainstream compliant exchanges typically require users to complete local identity verification (KYC). When selecting a platform, attention should be paid to its registration location, held regulatory licenses (such as a US MSB license, European VASP registration), security history, and the types of assets offered.
Currently, major global trading platforms do not support registration and trading for mainland Chinese residents. Investors should adhere to local laws and regulations and use platforms licensed in their respective countries or regions for trading. Before trading, real-time prices and market dynamics of relevant assets can be checked on market information platforms such as Svmuu.
Digital Yuan (e-CNY) and Blockchain Development
It is important to distinguish that China prohibits private cryptocurrencies but is vigorously promoting the research and pilot programs for its central bank digital currency (CBDC) — the Digital Yuan (e-CNY). The Digital Yuan is China's legal digital currency, issued by the People's Bank of China, and its official application is available for public download and use in pilot areas.
At the same time, China is also actively building a national blockchain service network (BSN), aimed at providing consortium blockchain technology services for enterprises, which is fundamentally different from open, decentralized public chains and cryptocurrencies.
