SPX6900 (spx) 
China Tightens Crypto Regulation with New Laws: A Look into the Country’s History of Anti-Crypto Measures
As 2025 begins, China has unveiled new laws that heavily restrict cryptocurrency circulation in mainland China. This latest development marks yet another attack on the crypto sector by the Chinese government.
New Regulations: Tightening the Noose on Crypto Transactions
On December 31, 2024, China’s foreign exchange regulator introduced new rules that require banks to flag and block cross-border crypto-related transactions. Banks must now track financial behavior deemed risky based on various factors, including the identity of transaction participants, source of funds, and trade frequency.
Formally, the regulation aims to control risky financial activity, categorizing transactions with crypto involvement as high-risk. This move adds a new dimension of risk to cryptocurrency transactions and may lead to unwanted attention from the state, service denials, and potential legal troubles for those involved.
Impact on the Chinese Crypto Sector
The new regulations may severely harm the Chinese cryptocurrency sector, which already operates under harsh conditions. Many key companies and entrepreneurs have fled the country to build their businesses elsewhere. Notable examples include Binance, the world’s leading crypto exchange, and Tron founder Justin Sun.
It is likely that China’s crypto laws will become even more hostile towards digital assets in the future, excluding Central Bank Digital Currencies (CBDCs). The latest regulations align with previous restrictions imposed by the Chinese authorities, which have impacted not only mainland China but also the global crypto sector.
A History of Anti-Crypto Measures in China
China has a long history of suppressing the local cryptocurrency sector. The government’s actions have had a significant impact on the global crypto market. In the past, China was a hub for cryptocurrency activity, with the launch of the first crypto exchange, BTC China, in 2011. However, the growing totalitarian tendencies in the country pushed people towards embracing cryptocurrency, which promised privacy and independence.
The Chinese government’s overall crypto regulation journey can be seen as the gradual elimination of tools for private, unsupervised financial activity, forcing institutions and individuals to use the digital yuan (e-CNY), an asset fully controlled by the government.
Global Impact of China’s Anti-Crypto Laws
China’s anti-crypto laws have had far-reaching consequences, including a substantial Bitcoin price drop in the crypto markets worldwide. In 2017, China banned initial coin offerings (ICOs), which led to a 5% drop in the BTC price. Although China was once the world’s crypto mining capital, the State Council banned cryptocurrency mining in 2021, allowing the USA to become the new leader in mining.
Other countries have also implemented anti-crypto laws, including Turkey, Egypt, Algeria, Morocco, and Bangladesh. It appears that China is not a role model for governments seeking to restrict cryptocurrencies but rather is exploring the effects of banning crypto using other countries’ experiences.
As the crypto landscape continues to evolve, stay informed about the latest developments and trends in the industry. For more news and updates on cryptocurrencies and finance, visit Global Crypto News.
