GFN – BEIJING: The People’s Bank of China and seven additional agencies issued a joint notice Friday prohibiting domestic entities and their offshore subsidiaries from issuing yuan-linked stablecoins or tokenized real-world assets without explicit government authorization to preserve national monetary sovereignty.

According to the regulatory directive mandates (via BBG) that onshore firms and the offshore entities they control are barred from the unauthorized issuance of digital tokens and yuan-linked stablecoins, citing significant risks to financial stability and risk control. The central bank emphasized that these digital assets do not possess legal tender status and that any related business activities within the mainland are classified as illegal financial operations.

 

“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 regulators said in the notice.

The notice specifically targeted the tokenization of real-world assets, clarifying that providing intermediary or technology services for such activities may amount to illegal fundraising if conducted without approval under designated financial infrastructure. Authorities also reiterated that offshore service providers are prohibited from offering crypto-related services to residents within China, with enforcement extending to domestic personnel supporting these operations.

 

Market analysts noted that the move appears designed to prevent capital flight and maintain the state’s monopoly on digital currency as the digital yuan expands its pilot scope. The restrictions follow a period of heightened volatility in global digital asset markets where major tokens have experienced significant price contractions since late 2025. The development reinforces China’s restrictive regulatory stance on decentralized finance while accelerating the integration of its sovereign digital currency into the broader financial system.