- Chinese regulators have intensified their crypto crackdown, warning that tokenizing real-world assets could constitute illegal fundraising.
- The authorities, including The People’s Bank of China, have banned unapproved offshore issuance of yuan-linked stablecoins.
- This regulatory action coincides with a significant market selloff, though Bitcoin saw a recent 8% rebound to approximately $67,801.
Chinese regulators issued a stark warning on Friday, asserting that tokenizing real-world assets could amount to illegal fundraising. This move intensifies the country’s longstanding crackdown on digital assets and related services.
According to a statement from The People’s Bank of China and seven other regulators, the country has now prohibited the offshore issuance of yuan-linked stablecoins unless authorized. This prohibition, highlighted in a Bloomberg report, aims to protect monetary sovereignty from perceived threats.
Officials reiterated that cryptocurrencies lack the legal status of fiat currency. Consequently, related mainland business activities are considered illegal financial operations.
The regulators stated that speculative crypto trading presents new challenges for financial risk control. “Speculation involving cryptocurrencies and real-world asset tokenization has occurred from time to time amid multiple factors, presenting new challenges for risk prevention and control, and necessitating stronger regulation to safeguard national security and social stability,” the notice reportedly said.
This regulatory announcement follows a prolonged Bitcoin selloff, which erased nearly half its value from a record above $126,000 in early October 2024. At the time of writing, Bitcoin had rebounded about 8% to $67,801.
Meanwhile, Ethereum experienced a similar recovery, rising 8.5% to $1,978.8. This uptick occurred after eight declining sessions out of the previous nine.
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