China bans unauthorized issuance of stablecoins pegged to the yuan
China promised on Friday to further strengthen the crackdown on digital currencies and prohibited the unauthorized offshore issuance of stablecoins pegged to the yuan, according to a statement released by the country's central bank.
"Virtual currencies do not have the same legal status as fiat currencies," stated the People's Bank of China and seven other agencies in a joint declaration, adding that commercial activities related to digital currencies are "illegal financial activities."
Without official approval, "national entities and their controlled entities abroad are prohibited from issuing virtual currencies overseas," they stated.
Regulators also prohibited national 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 circulating fiat currencies," they stated.
The central bank also warned financial institutions against providing banking and clearing services to companies related to virtual currencies.
Source: Investing.com
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