China's 2026 Crypto Regulations: Eight-Ministry Notice Explained
On February 6, 2026, the People's Bank of China, together with seven other central government departments, issued the "Notice on Further Preventing and Addressing Risks Related to Virtual Currencies" (Yin Fa [2026] No. 42). This is the most significant update to cryptocurrency regulation in mainland China since the nine-department notice in 2021.
This notice is consistent with the 2021 version in its basic stance, but there are several noteworthy new changes, particularly the explicit inclusion of RWA tokenization within the regulatory scope for the first time. As a cryptocurrency user in mainland China, understanding what this new regulation says and its actual impact is essential background knowledge.
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1. What This Notice Says
Overall stance unchanged: Virtual currency-related business activities are still deemed illegal financial activities in mainland China and are strictly prohibited from being conducted within the territory. This is consistent with the 2021 notice.
New key point 1: RWA tokenization explicitly named This is the most noteworthy new content in this notice. For the first time, the notice explicitly includes "RWA tokenization" (real-world asset tokenization) within the core risk category.
This means: issuing tokens via blockchain based on domestic assets and raising funds within the territory is explicitly identified as a activity. This is a direct blow to some projects attempting to promote the RWA concept in mainland China.
New key point 2: RMB stablecoins explicitly mentioned The notice uses clearer language regarding stablecoins pegged to the Renminbi, explicitly stating that such stablecoins shall not be issued or circulated within the territory.
New key point 3: Cross-border capital flow description clearer The wording regarding the transfer of funds across borders via cryptocurrencies is stricter than in 2021.
2. The Concurrently Released "Guidelines": A Channel for Overseas RWA Issuance
Notably, on the same day, the China Securities Regulatory Commission (CSRC) released the "Regulatory Guidelines on the Overseas Issuance of Asset-Backed Security Tokens Backed by Domestic Assets," providing a limited legal channel for high-quality domestic assets to issue tokens overseas through compliant methods.
This "blocking and channeling" dual-track arrangement indicates: the regulatory goal is not to completely block the application of blockchain technology, but to bring domestic asset tokenization activities into a controllable compliance framework, preventing capital outflows and financial risks.
3. Actual Impact on Ordinary Users in Mainland China
Risk level for personal cryptocurrency use has not changed significantly: This notice primarily targets institutions and business activities. It does not add new direct restrictions on individuals holding and trading cryptocurrencies on overseas exchanges.
Attention to C2C fiat on-ramp/off-ramp may increase: The stricter wording on cross-border capital flows means the risk associated with large cross-border transfers via cryptocurrencies has relatively increased. The actual risk for daily small-value fiat on-ramp/off-ramp activities has not changed much.
Be cautious with RWA-related projects: If you are following RWA tokenization projects involving mainland Chinese assets, the compliance risk for such projects within mainland China has significantly increased. Careful evaluation is needed before participation.
4. Key Differences from the 2021 Notice
| Comparison Item | 2021 Nine-Department Notice | 2026 Eight-Department Notice |
| Basic Stance | Virtual currency-related business illegal | Remains unchanged |
| RWA Tokenization | Not mentioned | Explicitly included in risk category |
| RMB Stablecoins | Implicit within overall framework | Explicitly stated |
| Cross-border Funds | Mentioned | Clearer and stricter wording |
| Supporting Guidance Policy | None | CSRC concurrently released overseas issuance guidelines |
5. Frequently Asked Questions
Q: Can I still use OKX and Binance after this new regulation? Yes. Personal use of overseas exchanges remains in a gray area. This notice does not change this fundamental situation. For detailed risk analysis, see: Is it illegal to use OKX in mainland China? · Is it illegal to use Binance in mainland China?
Q: Has the risk for large fiat on-ramp/off-ramp changed? It has slightly increased. The regulatory wording on cross-border capital flows is stricter, requiring more caution for large operations. It is recommended to keep complete transaction records and avoid frequent large transactions.
Q: Can RWA projects no longer be done? RWAs issued and funded domestically are explicitly prohibited. However, the CSRC has simultaneously opened a compliant channel for domestic assets to issue tokens overseas. Capable institutions can pursue the compliant route.
Q: Does this notice affect cryptocurrency users in Hong Kong? No. The scope of this notice is mainland China. Hong Kong has an independent regulatory framework and is not bound by this notice.
