A comprehensive understanding of the new judicial trends in virtual currency regulation in 2026!!

First, the conclusion:
1/ Personal holding and trading of cryptocurrencies are not illegal.
The announcement does not prohibit trading cryptocurrencies but calls on everyone not to do so because trading cryptocurrencies is inherently a high-risk investment activity.

Private play is fine, but at your own risk. As long as you do not engage in illegal activities, holding virtual currencies is not a crime.

The country has never strictly investigated cryptocurrency trading, nor has it set penalties for it. If you choose to play, you bear the risks and rewards.

Don’t mess up and then roll on the ground expecting others to bail you out.

2/ The state explicitly bans:
• Virtual currency issuance and fundraising (ICO, capital raising)
• Virtual currency trading platforms, intermediaries, and matching services
• Virtual currencies as a basis for legal tender payment functions
• Any commercial activities related to virtual currencies

This article summarizes the key developments in China’s virtual currency regulation policies, judicial practices, academic discussions, and interdepartmental cooperation in 2025, covering risk prevention, crackdowns on related illegal activities, and the improvement of virtual currency disposal rules involved in cases, now organized into a document for readers.

1. The newly revised “Anti-Money Laundering Law of the People’s Republic of China” came into effect on January 1, 2025. The new AML Law further promotes the comprehensive, continuous, and effective alignment of China’s anti-money laundering efforts with international standards, reflecting the people-oriented and professional nature of anti-money laundering work under the modern Chinese financial system.

2. On January 10, 2025, the Ministry of Public Security held a special press conference in Beijing. Spokesperson Zhang Ming introduced that scam groups are continuously upgrading their criminal tools using new technologies such as blockchain, virtual currencies, and AI intelligence. In response to the severe and complex criminal situation involving virtual currencies and online fraud, public security agencies will deepen special operations like “Cloud Sword,” “Flow Break,” and “Nail Removal,” maintaining a high-pressure crackdown.

3. On January 13, 2025, the National Prosecutors Conference was held in Beijing. The meeting summarized the 2024 prosecutorial work and outlined the main tasks for 2025. Prosecutorial agencies will intensify efforts to punish money laundering crimes and lawfully combat illegal cross-border asset transfers using virtual currencies. On February 15, the “2024 Report on Deepening Prosecutorial Reforms” was released, further strengthening efforts to combat crimes such as illegal cross-border asset transfers, tax evasion, and export tax rebate fraud involving virtual currencies.

4. On January 12-13, 2025, the Central Political and Legal Work Conference was held in Beijing. The meeting emphasized that for key and emerging fields, the Ministry of Justice should proactively research and propose legislative suggestions, such as issues related to autonomous driving, low-altitude economy, artificial intelligence, virtual currencies, and data ownership.

5. On January 19, 2025, a seminar on “Disposal of Cases Involving Virtual Currencies” was held in Beijing, jointly organized by the Law School of Renmin University of China, the Center for Criminal Legal Science of Renmin University, and Beijing Zhongyin Law Firm. Nearly 60 representatives from the Standing Committee of the National People’s Congress Legal Work Committee, Supreme People’s Court, Supreme People’s Procuratorate, Ministry of Public Security, and other practical departments, as well as legal scholars, lawyers, and enterprise representatives attended.

6. In February 2025, “Virtual Currencies and the Rule of Law” was included as a topic in the Shanghai Law Society’s “Eastern Legal Studies” 2025 essay call.

7. On February 23, 2025, the Beijing Third Intermediate People’s Court and Renmin University of China jointly held the opening demonstration of the major judicial research project “Research on the Disposal of Cases Involving Virtual Currencies” awarded by the Supreme People’s Court.

8. On the morning of March 8, 2025, Procurator-General Yu Chongyang delivered the work report of the Supreme Procuratorate at the third session of the 14th National People’s Congress. In 2024, procuratorial organs prosecuted 25,000 cases of financial fraud and crimes damaging financial order, including 3,032 cases involving money laundering through “virtual currencies” and transferring criminal proceeds abroad.

9. On April 7, 2025, the Ministry of Public Security issued the “Provisional Regulations on the Procedures for Funds Analysis and Appraisal by Public Security Organs,” officially launching funds analysis and appraisal work. The “Jinxi as Evidence” output was explicitly recognized as an appraisal opinion by the Ministry of Public Security. As of December 23, 2025, data from Beijing Economic Investigation indicated that funds analysis reports had been used as evidence in over 200 cases across 27 provinces, demonstrating initial practical breadth.

10. In May 2025, the Supreme Procuratorate and the State Administration of Foreign Exchange jointly released typical cases of criminal law enforcement in the field of foreign exchange.

11. On May 7, 2025, a seminar on “Practical Issues in Criminal Cases Involving Virtual Currencies” was hosted by Southwest University of Political Science and Law, Chongqing High People’s Court, and Chongqing Fifth Intermediate People’s Court, co-organized by the Law School and the Criminal Investigation College of Southwest University of Political Science and Law, successfully held at Southwest University of Political Science and Law.

12. On June 18, 2025, the Supreme Court released three reference cases involving criminal cases of virtual currencies.

13. On July 18, 2025, the People’s Bank of China publicly solicited opinions on the “Notice on Implementing the Administrative Measures for Anti-Money Laundering and Countering the Financing of Terrorism for Financial Institutions” (Draft for Comments).

14. On July 28, 2025, the Supreme People’s Court, Supreme People’s Procuratorate, and Ministry of Public Security jointly held a press conference, releasing the “Opinions on Handling Criminal Cases Related to Assistance in Information Network Crime Activities” and typical cases of punishing assistance in cybercrime and related crimes according to law.

15. On August 1, 2025, Hong Kong’s “Stablecoin Ordinance” officially came into effect.

16. In August 2025, the Supreme Procuratorate issued an announcement on the 2025 project approval for the Supreme People’s Procuratorate’s research on prosecutorial application theories, including multiple topics related to virtual currencies.

17. On September 4, 2025, the Management Science Department of the National Natural Science Foundation of China announced that the project “Research on Global Stablecoin Risk Governance and Cross-border Collaborative Regulation Systems” was included in the third issue of emergency management projects for 2025.

18. On September 16, 2025, the Shanghai Higher People’s Court issued normative guidelines for the disposal of virtual currencies in criminal cases across the city’s courts. Under the guidance and in cooperation with the Shanghai Public Security Bureau, the Baoshan District People’s Court successfully disposed of over 90,000 FIL tokens through a “domestic entrusted, overseas disposed, closed-loop return” method.

19. On September 23, 2025, the 15th China-ASEAN Chief Prosecutors’ Meeting was held in the Hong Kong SAR. Chief Prosecutor Yu Chongyang of China stated that China’s procuratorial organs are willing to work with ASEAN countries’ procuratorates to jointly combat money laundering and corruption crimes in the digital age, safeguard regional security and development, and better protect national interests and the well-being of the people, based on mutual respect for sovereignty, jurisdiction, and domestic law.

20. On October 27, 2025, the 2025 Financial Street Forum annual conference opened in Beijing. PBOC Governor Pan Gongsheng stated that stablecoins, as a financial activity, currently cannot effectively meet basic requirements such as customer identification and anti-money laundering, which amplifies global financial regulatory gaps, including money laundering, illegal cross-border fund transfers, and terrorist financing. Market speculation and bubbles are prevalent, increasing systemic vulnerabilities and impacting the monetary sovereignty of some underdeveloped economies. Pan emphasized that since 2017, the PBOC and relevant departments have issued multiple policies to prevent and address risks associated with domestic virtual currency trading and speculation, which remain effective. Moving forward, the PBOC will continue to work with law enforcement to crack down on domestic virtual currency operations and speculation, maintain financial order, and closely monitor and dynamically assess the development of overseas stablecoins.

21. On October 31, 2025, the official website of the People’s Bank of China published the “Summary of the Risks of Money Laundering and Terrorist Financing Facing China” in the “Anti-Money Laundering Report” column. China’s relevant departments continue to coordinate efforts to combat illegal activities related to virtual assets. In recent years, the number of financial intelligence reports involving virtual assets, criminal cases of money laundering, and prosecutions have all increased.

22. On November 13, 2025, the 8th National Criminal Trial Work Conference was held in Beijing. According to media reports, “Cases involving virtual currencies” were listed as a key topic. The Supreme Court President stated that courts across the country should lawfully punish frequent, high-incidence, and new types of crimes, and safeguard cyberspace security. Special focus should be on “cases involving virtual currency disposal, online obscene live streaming, jurisdiction over cybercrime cases, and electronic data evidence collection and certification.” The Supreme Court will further improve judicial rules and standardize judgments regarding these new issues.

23. On November 25, 2025, the 4th “Zhizheng·Theoretical Practice Colleague” criminal trial seminar was held at the Shanghai Second Intermediate Court, guided by the China Criminal Law Research Association and the Shanghai High People’s Court, co-organized by the Shanghai Second Intermediate Court and Renmin University Law School. The seminar focused on “Legal Uniformity in Cases of Virtual Currency Crimes,” using a “Theory-Practice 2+2” discussion format.

24. On November 28, 2025, the People’s Bank of China held a coordination meeting on combating virtual currency trading speculation. Representatives from the Ministry of Public Security, Cyberspace Administration, Financial Stability Development Committee, Supreme People’s Court, Supreme People’s Procuratorate, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Justice, PBOC, State Administration for Market Regulation, State Financial Supervision and Administration, China Securities Regulatory Commission, and State Foreign Exchange Administration attended. The meeting emphasized that virtual currencies do not have the same legal status as legal tender, lack legal convertibility, and should not and cannot circulate as currency in the market. Activities related to virtual currencies are illegal financial activities. Stablecoins are a form of virtual currency that currently cannot meet requirements like customer identification and anti-money laundering, and pose risks of being used for money laundering, fundraising scams, and illegal cross-border transfers. The meeting called for all units to adhere to Xi Jinping’s socialist ideology with Chinese characteristics, fully implement the spirit of the 20th National Congress and subsequent plenary sessions, prioritize risk prevention, continue the ban on virtual currency activities, and intensify efforts to combat illegal financial activities related to virtual currencies. Units should deepen cooperation, improve regulatory policies and legal bases, focus on information and fund flows, enhance information sharing, strengthen monitoring, crack down on illegal activities, protect public property, and maintain financial stability.

25. On December 5, 2025, the China Internet Finance Association, China Banking Association, China Securities Association, China Securities Investment Fund Industry Association, China Futures Association, China Listed Companies Association, and China Payment and Settlement Association jointly issued a “Risk Reminder on Preventing Illegal Activities Involving Virtual Currencies and Other Activities.” Members are prohibited from participating in the issuance and trading of virtual currencies and real-world asset tokens within China, directly or indirectly providing related services for clients’ issuance and trading of virtual currencies and real-world asset tokens within China. The public should remain highly vigilant against various forms of virtual currency and real-world asset token activities.

26. On December 16, 2025, the Procuratorate Daily published an article titled “Establishing Multiple Judicial Disposal Paths for Cases Involving Virtual Currencies.”

27. On December 17, 2025, the Supreme People’s Court issued the revised “Regulations on Civil Case Causes.” The revised “Civil Case Causes” officially included “Disputes over Virtual Property in Cyberspace” as an independent civil litigation cause, effective from January 1, 2026.