Chinese Central Bank Warns of Crypto Regulatory Gaps, Reaffirms Domestic Crackdown

China's central bank has intensified its scrutiny of stablecoins and cryptocurrency activities, with Governor Pan Gongsheng highlighting systemic risks posed by privately issued digital assets. Speaking at the 2025 Financial Street Forum in Beijing, Pan emphasized that stablecoins—though nascent—are exacerbating regulatory blind spots and undermining monetary sovereignty in vulnerable economies.

The remarks echo concerns raised during recent IMF/World Bank meetings, where global finance leaders flagged stablecoins' deficiencies in customer identification and anti-money laundering controls. "Speculative hype" and financial fragility were cited as direct consequences of these regulatory shortcomings.

Domestically, the People's Bank of China maintains its hardline stance. Since 2017, the institution has coordinated with regulators to suppress cryptocurrency operations, viewing them as incompatible with China's financial stability objectives.