China’s central bank and financial regulators have issued a sweeping joint notice, banning all unapproved issuance of yuan-pegged stablecoins, including those created offshore. The notice also classifies most real-world asset (RWA) tokenization as illegal financial activity unless conducted on state-approved infrastructure. This move reinforces China’s longstanding crackdown on cryptocurrency and follows recent interventions to halt speculative crypto trading and private stablecoin projects linked to Hong Kong.
China’s central bank and nine other regulators have issued a joint notice banning unapproved yuan-linked stablecoin issuance and classifying most real-world asset tokenization as illegal. The notice frames these activities as sources of systemic financial risk and reaffirms that cryptocurrencies lack legal tender status.
Authorities stated that virtual currency-related business activities constitute illegal financial activities. Trading, issuance, and intermediary services for crypto are “strictly prohibited across the board and shall be resolutely banned according to law.”
The notice defines real-world asset tokenization as using technology to turn asset rights into tokens for trading. Such activities are now illegal unless explicitly approved and conducted within designated financial infrastructure.
This action follows earlier warnings about a rebound in offshore crypto platform activity drawing domestic participation. Regulators had previously directed brokers to suspend RWA tokenization linked to Hong Kong and intervened in tech firms’ stablecoin plans.
Jamie Green, COO at Superset, said the bans guard the digital yuan against “private offshore competition that could facilitate capital flight and undermine monetary sovereignty.” He explained the notice is an example of “regulatory enclosure” forcing a nascent industry into a state-approved framework.
“By demanding prior approval for any renminbi-linked tokens, Beijing is ensuring that the state remains the gatekeeper of the digital renminbi’s footprint globally,” Green added. Christian Ruz of Hype noted this is China’s first crypto ban of 2026, adding to a long line of restrictions.
“Chinese investors already know how to survive these restrictions and they know their risks of holding renminbi is higher than holding U.S.-pegged stablecoins,” Ruz stated. He anticipated limited impact, as most stablecoin and RWA firms operate globally.
