China may be preparing for a fundamental change in its approach to virtual currencies.

At the Central Political and Legal Work Conference in Beijing—the country’s highest-level legal and governance meeting—officials explicitly called for enhanced research into emerging technologies and stronger oversight to prevent the misuse of blockchain and encryption technologies to evade regulation.

This is not a routine policy signal. The scale and authority of this conference suggest that comprehensive domestic virtual currency legislation is now actively underway, with 2026 emerging as a key timeline.

🔍 Why this matters

1️⃣ From “Blocking” to “Unblocking”

Since China’s blanket ban on virtual currencies, crypto activity has not disappeared—it has gone underground. Authorities increasingly view this as undesirable, preferring economic activity to operate in the open, under legal supervision.

Rather than endless crackdowns, regulators now appear focused on defining boundaries and setting rules.

2️⃣ Legal vacuum and rising disputes

Crypto-related crimes—such as stolen USDT and rapid fund laundering across multiple addresses—have surged. Recovery is difficult, and sentencing remains unclear due to a lack of applicable laws.

Legislation is now seen as urgent to establish legal accountability, enforcement standards, and judicial clarity.

3️⃣ Global pressure is mounting

While China hesitated, major economies—including the U.S., Japan, South Korea, Singapore, and the UAE—moved forward with regulation, licensing frameworks, and even state-level participation.

Remaining outside this system risks long-term marginalization in global financial innovation.

🧭 A turning point

This conference signals a strategic transition:

➡️ From outright prohibition

➡️ To regulated participation

The era of crypto’s “wild growth” in China is ending.

The era of rule-of-law governance for virtual assets is approaching.

And as regulation replaces uncertainty, capital, compliance, and confidence may return.

💡 Some wallets may indeed get heavier—but only under the law.

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