Comprehensive Ban on Virtual Currency Trading in Mainland China
Since September 24, 2021, the People's Bank of China (PBOC) and nine other departments jointly issued a notice explicitly classifying virtual currency-related business activities as illegal financial activities, requiring their strict prohibition. Subsequently, overseas virtual currency exchanges providing services to Chinese residents via the internet were also included in the prohibition. This policy stance has been continuously reinforced in subsequent years. For instance, in December 2025, the PBOC once again emphasized sustained crackdown, and in February 2026, the PBOC and seven other departments jointly issued a document reiterating that virtual currencies do not possess legal tender status, and all related business activities within China are strictly prohibited.
Therefore, under the current regulatory environment, there are no legally operating digital currency exchanges within mainland China, and consequently, no such thing as the "largest digital currency exchange."
Historical Transformation and Overseas Development
Before the implementation of the ban, some well-known digital currency trading platforms had close ties with the Chinese market. For example, Huobi, Binance, and OKEx (now OKX) all had a large number of users and operations in mainland China. However, with the full enforcement of the 2021 ban, these platforms have ceased providing services to mainland Chinese users and completed user offboarding in accordance with policy requirements. Their business focus has completely shifted to overseas markets, where they comply with regulatory requirements in various jurisdictions worldwide.
Legal Boundaries of Personal Holdings and Trading Activities
Although virtual currency trading activities are strictly prohibited in mainland China, according to some legal professionals, merely holding virtual currencies personally is not considered illegal. However, once it involves engaging in business activities such as issuing, trading, exchanging virtual currencies, acting as a central counterparty for virtual currency trading, or providing information intermediation and pricing services for virtual currency transactions, it is explicitly classified as an illegal financial activity and will be severely sanctioned by law.
Parallel Development of the Digital Yuan
In contrast to the strict restrictions on private cryptocurrencies, the Chinese government is actively promoting the research and development and application of its central bank digital currency (CBDC), the Digital Yuan. The Digital Yuan aims to strengthen state control over currency and financial sovereignty and is undergoing extensive pilot programs in retail payments. As of the end of 2024, the transaction volume of the Digital Yuan has reached 200 billion RMB, demonstrating its popularity and application potential under official promotion.
