BEIJING, Feb 6 (Reuters) – China vowed to further tighten its crackdown on virtual currencies on Friday and banned unauthorised offshore issuance of yuan-pegged stablecoins, according to a notice released by its central bank.
Beijing has long taken a tough stance on virtual currencies, but officials said recent “speculative activities” posed new challenges that warranted additional measures.
“Virtual currencies do not have the same legal status as fiat currencies,” the People’s Bank of China and seven other agencies said in a joint statement, adding that business activities related to virtual currencies are “illegal financial activities.”
Without official approval, “domestic entities and their controlled overseas entities are prohibited from issuing virtual currencies overseas,” they said.
Regulators also banned domestic and foreign entities from issuing offshore stablecoins pegged to the yuan without authorization.
“Stablecoins pegged to fiat currencies effectively perform some of the functions of fiat currencies in circulation,” they said.
The central bank also warned financial institutions against providing banking and clearing services to virtual currency-related businesses.
(Reporting by Xiuhao Chen and Ryan Woo; Editing by Toby Chopra and Susan Fenton)
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