Foreword: Today, the official website of the People's Bank of China released the "Notice of the People's Bank of China, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration for Market Regulation, National Financial Regulatory Administration, China Securities Regulatory Commission, and State Administration of Foreign Exchange on Further Preventing and Disposing of Risks Related to Virtual Currencies, etc. (Yin Fa [2026] No. 42)". This latest set of regulatory requirements from the Central Bank and eight other departments is consistent with the regulatory requirements of recent years, primarily regulating speculative activities such as virtual currency trading, exchange, ICOs, and overseas platform services. However, this notice adds regulation on RWA, explicitly prohibiting RWA tokenization and stablecoins (especially those pegged to the Renminbi). The full text is as follows:

To the People's Governments of all provinces, autonomous regions, and municipalities directly under the Central Government, and the Xinjiang Production and Construction Corps:

Recently, speculative activities related to virtual currencies and the tokenization of Real World Assets (RWA) have occurred from time to time, disrupting the economic and financial order and endangering the safety of people's property. In order to further prevent and dispose of risks related to virtual currencies and the tokenization of Real World Assets, and to effectively safeguard national security and social stability, in accordance with the Law of the People's Republic of China on the People's Bank of China, the Commercial Bank Law of the People's Republic of China, the Securities Law of the People's Republic of China, the *Securities Investment Fund Law of the

People's Republic of China, theFutures and Derivatives Law of the People's Republic of China, theCybersecurity Law of the People's Republic of China, theRegulations of the People's Republic of China on the Administration of Renminbi, theRegulations on the Prevention and Disposal of Illegal Fund-raising, theRegulations of the People's Republic of China on Foreign Exchange Administration, and theRegulations of the People's Republic of China on Telecommunications*, and upon agreement with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, and with the approval of the State Council, the following matters are hereby notified:

I. Clarifying the Essential Attributes of Virtual Currencies, Real World Asset Tokenization, and Related Business Activities

(1) Virtual currencies do not have the same legal status as legal tender. Virtual currencies such as Bitcoin, Ethereum, and Tether have main characteristics such as being issued by non-monetary authorities, using encryption technology and distributed ledgers or similar technologies, and existing in digital form. They do not have legal compensability and should not and cannot be used as currency in the market.

Business activities related to virtual currencies belong to illegal financial activities. Carrying out business activities related to virtual currencies in China, such as the exchange of legal tender and virtual currencies, exchange between virtual currencies, buying and selling virtual currencies as a central counterparty, providing information intermediary and pricing services for virtual currency transactions, token issuance financing, and transactions of virtual currency derivatives, are suspected of illegal financial activities such as illegal sale of tokens and tickets, unauthorized public issuance of securities, illegal operation of securities and futures businesses, and illegal fund-raising. They strictly prohibited and shall be resolutely banned in accordance with the law. Overseas units and individuals shall not provide services related to virtual currencies to domestic subjects in any form illegally.

Stablecoins pegged to legal tender disguise themselves to perform some functions of legal tender in circulation and use. Without the approval of relevant departments in accordance with laws and regulations, no unit or individual inside or outside China may issue stablecoins pegged to the Renminbi overseas.

(2) Real World Asset (RWA) tokenization refers to activities that use encryption technology and distributed ledgers or similar technologies to convert ownership, income rights, etc., of assets into tokens or other rights and bond certificates with token characteristics, and conduct issuance and trading.
Carrying out Real World Asset tokenization activities in China, as well as providing related intermediary and information technology services, are suspected of illegal financial activities such as illegal sale of tokens and tickets, unauthorized public issuance of securities, illegal operation of securities and futures businesses, and illegal fund-raising, and shall be prohibited; relevant business activities carried out relying on specific financial infrastructures with the approval of competent business departments in accordance with laws and regulations are excluded. Overseas units and individuals shall not provide services related to Real World Asset tokenization to domestic subjects in any form illegally.

II. Improving Working Mechanisms

(3) Departmental coordination and linkage. The People's Bank of China, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration for Market Regulation, the National Financial Regulatory Administration, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange, shall improve working mechanisms, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, form a joint force, and coordinate and guide all regions to carry out risk prevention and disposal work for illegal financial activities related to virtual currencies.

The China Securities Regulatory Commission, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the National Financial Regulatory Administration, and the State Administration of Foreign Exchange, shall improve working mechanisms, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, form a joint force, and coordinate and guide all regions to carry out risk prevention and disposal work for illegal financial activities related to Real World Asset tokenization.

(4) Strengthening local implementation. Provincial-level people's governments are responsible for overall planning of risk prevention and disposal work related to virtual currencies and Real World Asset tokenization within their administrative regions. This shall be led specifically by local financial management departments, with the participation of branches and dispatched institutions of the financial management departments of the State Council, as well as telecommunications authorities, public security, market regulation, and other departments. They shall coordinate with cyberspace departments, people's courts, and people's procuratorates, improve normalized working mechanisms, effectively link with the relevant working mechanisms of central departments, form a working pattern of coordination between the central and local governments and combination of strips and blocks, actively prevent and properly handle risk issues related to virtual currencies and Real World Asset tokenization, and maintain economic and financial order and social stability.

III. Strengthening Risk Monitoring, Prevention, and Disposal

(5) Strengthening risk monitoring. The People's Bank of China, the China Securities Regulatory Commission, the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration of Foreign Exchange, and cyberspace departments shall continue to improve monitoring technical means and system support, strengthen cross-departmental data comprehensive analysis and sharing, establish and improve information sharing and cross-verification mechanisms, and timely grasp the risk situation of activities related to virtual currencies and Real World Asset tokenization. Provincial-level people's governments shall give full play to the role of local monitoring and early warning mechanisms. Local financial management departments, together with branches and dispatched institutions of the financial management departments of the State Council, as well as cyberspace, public security, and other departments, shall ensure effective connection between online monitoring, offline investigation, and fund monitoring, efficiently and accurately identify activities related to virtual currencies and Real World Asset tokenization, share risk information in a timely manner, and improve the rapid response mechanism for early warning information transmission, verification, and disposal.

(6) Strengthening the management of financial, intermediary, technical, and other service institutions. Financial institutions (including non-bank payment institutions) shall not provide services such as account opening, fund transfer, and clearing and settlement for business activities related to virtual currencies, shall not issue and sell financial products related to virtual currencies, shall not include virtual currencies and related financial products in the scope of collateral, shall not carry out insurance businesses related to virtual currencies or include virtual currencies in the scope of insurance liability, and shall strengthen risk monitoring and timely report clues of violations of laws and regulations to relevant departments. Financial institutions (including non-bank payment institutions) shall not provide services such as custody, clearing, and settlement for unauthorized business activities related to Real World Asset tokenization and related financial products. Relevant intermediary institutions and information technology service institutions shall not provide intermediary, technical, and other services for unauthorized business activities related to Real World Asset tokenization and related financial products.

(7) Strengthening Internet information content and access management. Internet enterprises shall not provide services such as online business premises, commercial display, marketing publicity, and paid traffic diversion for business activities related to virtual currencies and Real World Asset tokenization. Upon discovering clues of violations of laws and regulations, they shall timely report to relevant departments and provide technical support and assistance for relevant investigation and investigation work. Cyberspace, telecommunications authorities, and public security departments shall, based on problem clues transferred by financial management departments, timely close and dispose of websites, mobile applications (including mini-programs), and public accounts that carry out business activities related to virtual currencies and Real World Asset tokenization in accordance with the law.

(8) Strengthening the management of business entity registration and advertising. Market regulation departments shall strengthen the management of business entity registration. The registered names and business scopes of enterprises and individual industrial and commercial households shall not contain words or contents such as "virtual currency," "virtual asset," "cryptocurrency," "crypto asset," "stablecoin," "Real World Asset tokenization," or "RWA." Market regulation departments, together with financial management departments, shall strengthen the supervision of advertisements related to virtual currencies and Real World Asset tokenization in accordance with the law, and timely investigate and deal with relevant illegal advertisements.

(9) Continuing to rectify virtual currency "mining" activities. The National Development and Reform Commission, together with relevant departments, shall strictly control virtual currency "mining" activities and continue to promote the rectification of virtual currency "mining" activities. Provincial-level people's governments assume overall responsibility for the rectification of "mining" within their administrative regions. In accordance with the requirements of the Notice on Rectifying Virtual Currency "Mining" Activities (Fa Gai Yun Xing [2021] No. 1283) issued by the National Development and Reform Commission and other departments and the provisions of the Guidance Catalogue for Industrial Structure Adjustment (2024 Edition), they shall comprehensively sort out, investigate, and shut down existing virtual currency "mining" projects, strictly prohibit new "mining" projects, and strictly prohibit "mining machine" production enterprises from providing various services such as "mining machine" sales in China.

(10) Severely cracking down on relevant illegal financial activities. After discovering clues of illegal financial activities related to virtual currencies and Real World Asset tokenization, local financial management departments, branches and dispatched institutions of the financial management departments of the State Council, and other relevant departments shall investigate, identify, and properly dispose of them in a timely manner in accordance with the law, and strictly pursue the legal responsibilities of relevant units and individuals. Those suspected of crimes shall be transferred to judicial organs for handling in accordance with the law.

(11) Severely cracking down on relevant illegal and criminal activities. The Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the National Financial Regulatory Administration, the China Securities Regulatory Commission, and other departments, as well as judicial organs and procuratorial organs, shall, in accordance with their division of responsibilities, severely crack down on illegal and criminal activities such as fraud, money laundering, illegal business operations, pyramid schemes, and illegal fund-raising related to virtual currencies and Real World Asset tokenization, as well as relevant illegal and criminal activities carried out under the guise of virtual currencies and Real World Asset tokenization.

(12) Strengthening industry self-discipline management. Relevant industry associations shall strengthen member management and policy publicity, base themselves on their own functional positioning, advocate and urge member units to boycott illegal financial activities related to virtual currencies and Real World Asset tokenization, and punish member units that violate regulatory policies and industry self-discipline rules in accordance with relevant self-discipline management regulations. Relying on various types of industry infrastructure, they shall carry out risk monitoring related to virtual currencies and Real World Asset tokenization and timely transfer problem clues to relevant departments.

IV. Implementing Strict Regulation on Domestic Subjects Conducting Related Business Overseas

(13) Without the approval of relevant departments in accordance with laws and regulations, domestic subjects and the overseas subjects they control shall not issue virtual currencies overseas.

(14) Domestic subjects directly or indirectly conducting Real World Asset tokenization business in the form of foreign debt overseas, or conducting Real World Asset tokenization business with the nature of quasi-asset securitization or equity based on domestic asset ownership, income rights, etc. (hereinafter collectively referred to as domestic rights and interests) overseas, shall be strictly regulated by the National Development and Reform Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other relevant departments in accordance with their division of responsibilities and laws and regulations, following the principle of "same business, same risks, same rules." For other forms of Real World Asset tokenization business conducted by domestic subjects based on domestic rights and interests overseas, the China Securities Regulatory Commission shall regulate them together with relevant departments according to the division of responsibilities. Without the consent, filing, etc., of relevant departments, no unit or individual may conduct the above businesses.

(15) Overseas subsidiaries and branches of domestic financial institutions shall be lawful and prudent in providing services related to Real World Asset tokenization overseas, equipped with professional personnel and systems, effectively prevent business risks, strictly implement requirements such as customer access, suitability management, and anti-money laundering, and incorporate them into the compliance and risk control management system of domestic financial institutions. Intermediary institutions and information technology service institutions that provide services for domestic subjects directly or indirectly conducting Real World Asset tokenization business in the form of foreign debt overseas, or conducting Real World Asset tokenization related business based on domestic rights and interests overseas, shall strictly abide by the provisions of laws and regulations, establish and improve relevant compliance and internal control systems in accordance with relevant normative requirements, strengthen business and risk control, and report the relevant business development situation to relevant management departments for approval or filing.

V. Strengthening Organization and Implementation

(16) Strengthening organizational leadership and overall coordination. All departments and regions must attach great importance to the risk prevention work related to virtual currencies and Real World Asset tokenization, strengthen organizational leadership, clarify work responsibilities, form a long-term working mechanism of central coordination, local implementation, and joint responsibility, maintain a high-pressure posture, dynamically monitor risks, powerfully, orderly, and effectively prevent and resolve risks, protect the safety of people's property in accordance with the law, and fully maintain economic and financial order and social stability.

(17) Extensively carrying out publicity and education. All departments, regions, and industry associations must make full use of various media and other dissemination channels to publicize the illegality, harm, and manifestations of businesses related to virtual currencies and Real World Asset tokenization through methods such as legal policy interpretation, analysis of typical cases, and investment risk education, fully prompt possible hidden risks, and improve the public's risk prevention awareness and identification ability.

VI. Legal Liability

(18) Those who violate the provisions of this notice by carrying out illegal financial activities related to virtual currencies and Real World Asset tokenization, as well as providing services for businesses related to virtual currencies and Real World Asset tokenization, shall be punished in accordance with relevant regulations; if a crime is constituted, criminal responsibility shall be pursued in accordance with the law. Domestic units and individuals who know that overseas subjects are illegally providing services related to virtual currencies and Real World Asset tokenization to the territory but still provide assistance to them shall be held legally responsible; if a crime is constituted, criminal responsibility shall be pursued in accordance with the law.

(19) Any civil legal acts of units and individuals investing in virtual currencies, Real World Asset tokens, and related financial products that violate public order and good customs are invalid, and the losses caused thereby shall be borne by themselves; those suspected of disrupting financial order and endangering financial security shall be investigated and dealt with by relevant departments in accordance with the law.

This notice shall come into force from the date of its release. The "Notice on Further Preventing and Disposing of Risks of Speculation in Virtual Currency Transactions" (Yin Fa [2021] No. 237) issued by the People's Bank of China and ten other departments is simultaneously abolished.

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