China expands anti-corruption push to virtual currency and blockchain

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China expands anti-corruption to virtual assets

Highlights

China's Communist Party Central Committee expanded its anti-corruption mandate to cover virtual currency and blockchain in a new directive adopted at the Fifth Plenary Session.
The new policy calls for cracking down on digital corruption through internet, virtual currency, cross-border funds, and blockchain, targeting both new and concealed methods.
China has reinforced its ban on crypto-related activities, with a February 6 central bank notice restating that all virtual currency business in mainland China remains illegal.

Party decision broadens focus to digital corruption methods

As reported by CoinDesk, citing Xinhua, the Communist Party's Central Committee includes virtual currency and blockchain in a new anti-corruption directive adopted at the Fifth Plenary Session of the 20th Central Committee. The decision forms part of what the Party describes as "full and rigorous Party self-governance," a broader drive to strengthen discipline within its own ranks.

In the section dealing with corruption, the text calls for efforts to "resolutely crack down on corruption carried out through the internet, virtual currency, cross-border funds, blockchain and the like," according to the translated wording cited in the report. The document does not mention bitcoin specifically, and it does not address crypto trading, mining or stablecoins.

The same text also urges authorities to "dig deep into new and hidden types of corruption," listing practices such as expected gains, agreed proxy holding, "white gloves" and the official-business revolving door.

Crypto restrictions remain in place across mainland China

China has maintained a long-running ban on crypto-related activity, providing wider policy context for the latest Party language. In December 2013, the People's Bank of China and other regulators bar banks from handling bitcoin transactions, and in September 2017 the central bank bans initial coin offerings and exchanges serving users in China.

Regulatory pressure intensifies further in September 2021, when the central bank and other agencies declare all crypto transactions illegal and Beijing moves against mining. More recently, a central bank-led notice issued on Feb. 6 restates that virtual currency business on the mainland is illegal financial activity, while also barring offshore yuan-pegged stablecoins and unapproved tokenization of real-world assets.

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