Crypto Exchange Restrictions for Chinese Citizens in 2026

As of June 2025, Chinese citizens can no longer legally buy, sell, hold, or trade any cryptocurrency - not even Bitcoin or Ethereum. This isn’t a rumor or a gray area. It’s the law. The People’s Bank of China (PBOC) issued Circular No.237, making every form of crypto activity illegal for anyone living in mainland China. That includes mining, using crypto as payment, even holding it in a personal wallet. The ban is total, and enforcement is getting tighter every month.

How China Got to a Complete Crypto Ban

China didn’t wake up one day and decide to ban crypto. It was a slow, deliberate climb over more than a decade. Back in 2013, when Bitcoin was still new, Chinese banks were told not to process Bitcoin transactions. That was the first warning. By 2017, initial coin offerings (ICOs) were shut down overnight - 24 platforms closed in a single day. Exchanges like BTCC, once China’s biggest, were forced to shut down or move overseas.

Then came the mining crackdown. In 2021, China banned cryptocurrency mining because it used too much electricity. Thousands of miners packed up their rigs and moved to Kazakhstan, the U.S., or Russia. But even after mining was gone, people still traded crypto using foreign exchanges. So in September 2021, regulators made it illegal to even facilitate crypto trades - no more converting yuan to Bitcoin, no more peer-to-peer deals.

The final step came in June 2025. The PBOC didn’t just ban exchanges anymore. They banned ownership. If you’re a Chinese citizen, holding any crypto - even if you bought it before the ban - is now against the law. The government didn’t just shut down platforms. They shut down access.

How the Ban Works in Practice

It’s not enough to just close down local exchanges. China’s system is built to stop crypto before it even reaches your phone. Banks like ICBC, China Construction Bank, and even Alipay and WeChat Pay are required to monitor every transaction for signs of crypto activity. If you send money to a known crypto OTC broker, your account gets flagged. If you repeatedly transfer funds to offshore wallets, your bank may freeze your account and report you to authorities.

In July 2025, police raided dozens of homes and offices targeting people who used USDT (Tether) to move money out of China. Why? Because crypto was being used to bypass capital controls. The yuan was weakening, and people were trying to protect their savings. The government saw crypto as a threat to financial stability - and acted.

Even discussing crypto on social media can get you in trouble. Promotional posts about “how to buy Bitcoin in China” have been removed. Self-media accounts that once pushed crypto tips are now silent. Some users have been fined or forced to attend government-run “financial education” sessions.

What About Offshore Exchanges?

You might think, “I’ll just use Binance or Kraken from overseas.” But that’s not as simple as it sounds. Since June 2025, any foreign exchange that knowingly serves Chinese users is considered an illegal financial operator under Chinese law. While the exchanges themselves aren’t shut down, the Chinese government has made it nearly impossible to fund them.

Most payment processors that link to foreign crypto sites have been cut off. Credit cards don’t work. Bank transfers get blocked. Even using a VPN won’t help if your bank detects you’re trying to send money to a crypto platform. Some users still try - using peer-to-peer networks or crypto-to-cash intermediaries - but these are risky. Many have been arrested for “illegal foreign exchange trading” or “operating an unlicensed financial service.”

There’s no legal way to deposit yuan into a foreign crypto exchange anymore. No loopholes. No gray zones. The system is designed to make it easier to avoid crypto than to find a way around it.

China’s Alternative: The Digital Yuan

China isn’t against digital money. It just wants control over it. The digital yuan, or e-CNY, is China’s state-backed central bank digital currency (CBDC). It’s not decentralized. It’s not anonymous. It’s fully tracked by the government.

The PBOC has rolled out the digital yuan in dozens of cities, from Beijing to Shenzhen. People use it to pay for groceries, public transport, even rent. Transactions are recorded, monitored, and can be frozen if needed. The government sees this as the future: a currency that can’t be used for capital flight, tax evasion, or black-market trade.

The crypto ban isn’t about technology - it’s about power. Bitcoin can’t be controlled. The digital yuan can. Every transaction, every transfer, every time you spend - the government knows. That’s the trade-off.

What Happens If You Get Caught?

The penalties aren’t theoretical. In early 2026, a man in Guangzhou was sentenced to two years in prison for using a P2P platform to buy $150,000 worth of Bitcoin. He wasn’t mining. He wasn’t running an exchange. He just bought crypto for himself. The court ruled it was “illegal financial activity.”

Fines are common. Account freezes are routine. Some people lose access to their bank accounts for months. Businesses that held crypto on their books - even as a minor asset - have faced audits, tax penalties, and forced asset liquidation.

Even holding crypto from before the ban isn’t safe. Authorities have the power to demand wallet addresses. If you can’t prove you owned it legally before June 2025, you could be forced to surrender it - or face legal consequences.

How This Compares to the Rest of the World

While China shuts down crypto, places like Hong Kong are building it. Hong Kong has licensed exchanges, allows institutional crypto trading, and even permits Bitcoin ETFs. Singapore, the U.S., and the EU all have clear rules - even if they’re strict. But China is the only country that has made it illegal for its citizens to own crypto at all.

Some countries ban crypto mining. Others ban ICOs. China bans everything - including personal use. That’s unique. Even Russia, which has heavy controls, still allows private ownership. China doesn’t.

This isn’t just about finance. It’s about control. China’s government sees decentralized money as a threat to its authority. And it’s willing to use its entire legal, technological, and surveillance system to stop it.

What’s Next for Chinese Citizens?

There’s no sign the ban will lift. The PBOC has made it clear: financial stability and control over the currency come first. The digital yuan is expanding. More cities are being added. More merchants are required to accept it. The infrastructure is being built to make cash obsolete - and crypto irrelevant.

For now, Chinese citizens have two choices: comply or risk serious consequences. There’s no middle ground. No legal way to invest in crypto. No safe way to hold it. The door is closed.

Some people still try. They use underground networks. They trade in cash. They rely on friends abroad. But these are high-risk, high-stakes gambles. And with every passing month, the chances of getting caught rise.

The future of money in China isn’t Bitcoin. It’s not Ethereum. It’s a number on a government screen - one that can be turned off at any time.