China's Central Bank Reaffirms Cryptocurrency Crackdown, Citing Stablecoin Risks

PBOC Governor Reaffirms Strict Stance on Crypto

Beijing, China – The People's Bank of China (PBOC) has reiterated its firm commitment to maintaining a strict crackdown on domestic cryptocurrency operations and speculation. Speaking at the 2025 Financial Street Forum Annual Meeting in Beijing on Monday, October 27, 2025, PBOC Governor Pan Gongsheng emphasized that the central bank's existing policies to combat cryptocurrency-related risks remain effective and will continue to be enforced.

Continued Enforcement Against Domestic Operations

Governor Pan stated that the PBOC will continue to collaborate with law enforcement agencies to crack down on relevant activities within mainland China to safeguard economic and financial order. This ongoing effort targets domestic operations and speculative activities involving virtual currencies. The central bank has consistently positioned digital assets as a threat to economic order, reaffirming its 'zero-tolerance policy' toward private digital currencies.

Stablecoins Identified as a Global Financial Threat

A significant focus of Governor Pan's remarks was the growing concern over stablecoins. He warned that these virtual currencies, despite their recent emergence, are still in their early stages of development and pose considerable risks. Pan highlighted that stablecoins 'can't meet the basic requirements like customer identification and anti-money laundering,' thereby amplifying loopholes in global financial regulation. He further asserted that the rise of stablecoins is increasing the vulnerability of the global financial system and undermining the monetary sovereignty of some less developed economies.

Discussions at recent IMF and World Bank Annual Meetings in Washington, D.C., also saw global finance ministers and central bank governors raise concerns about the systemic risks posed by stablecoins, echoing Pan's sentiments regarding their failure to meet basic AML and Know Your Customer (KYC) standards.

Monitoring Overseas Developments and Promoting Digital Yuan

In addition to its domestic crackdown, the PBOC will closely monitor and assess the development of stablecoins in overseas markets. This scrutiny comes as other Asian nations, such as Japan and South Korea, advance their own regulated stablecoin projects. Meanwhile, China continues to promote its state-backed digital currency, the digital yuan (e-CNY), as a safer and more regulated alternative.

China's stringent approach to cryptocurrencies dates back to 2017, with significant bans on trading, mining, and exchange operations. These measures were initially driven by concerns over financial crime, speculative trading, and capital flight. Governor Pan's latest remarks underscore Beijing's determination to maintain control over its digital financial landscape and safeguard its economic stability.