Legal Status of Crypto in China: What You Need to Know

When talking about legal status of crypto in China, the collection of laws, rules, and official statements that decide if digital currencies can be bought, sold, mined, or used on the mainland. Also known as China's crypto regulatory framework, it dictates everything from exchange licensing to tax obligations.

The core of legal status of crypto in China hinges on three pillars: outright bans on financial services involving crypto, strict licensing for any remaining exchanges, and a growing set of compliance requirements for blockchain projects. These pillars form a triad that encompasses market access, requires thorough AML/KYC procedures, and influences investor behavior both domestically and abroad.

One major pillar is cryptocurrency regulation in China, the series of directives issued by the People's Bank, the Cyberspace Administration, and other state bodies that forbid crypto trading, limit foreign crypto exposure, and criminalize unregistered financial activities. This regulatory web also digital currency crackdown. Because the rules are enforced at the provincial level, the impact can vary, but the overall trend is a tightening of permissible activities.

Another key piece is the digital asset exchange policy, the specific licensing criteria and operational limits that any crypto exchange must meet to stay legal in China, including capital requirements, data reporting, and real‑name verification. Exchanges that fail to obtain the proper license face shutdown, fines, or criminal charges. This policy requires robust compliance tech and pushes many platforms to relocate their servers offshore.

Beyond bans and licensing, China has introduced a blockchain law in China, a set of statutes that distinguishes blockchain technology from crypto assets, encouraging innovation in supply‑chain tracking while still restricting speculative token use. The law enables enterprises to develop private chain solutions without fear of being labeled illegal, but it does not grant any leeway for public token trading.

Taxes also play a role. While the government does not yet have a dedicated crypto tax code, existing income‑tax and value‑added‑tax regulations are applied to any crypto‑related earnings that can be traced. This creates a gray area where miners and traders must self‑report, and non‑compliance can trigger audits under broader financial crime statutes.

All these elements together shape the market landscape. Investors see reduced liquidity on domestic platforms, miners shift operations to neighboring countries, and developers focus on permissioned blockchains or decentralized finance projects that stay outside the jurisdiction of the bans. The ecosystem adapts quickly, but the underlying legal framework remains the anchor that decides which activities survive.

What Comes Next?

Below you'll find a curated list of articles that break down each of these aspects in detail—how to stay compliant, what the latest rulings mean for your portfolio, and practical steps for navigating the ever‑changing regulatory environment in China.