Hong Kong-listed crypto stocks took a beating on Monday after China’s central bank basically said they’re going hard after virtual currencies and stablecoins. The People’s Bank of China warned over the weekend about rising crypto speculation and promised to crack down on illegal stablecoin activities.
Yunfeng Financial Group, which has been getting into crypto and tokenization stuff, dropped over 10% in early trading, heading for its worst day in two months. Bright Smart Securities fell about 7%, and OSL Group lost more than 5%.
Liu Honglin, who founded Man Kun Law Firm, said the PBOC statement completely killed any confusion or hope people had about China maybe loosening up on stablecoin policies. He said regulators basically drew a clear red line where before things were kind of vague.
This is rough timing because Hong Kong just passed a stablecoin bill back in May trying to position itself as a digital asset hub. That got people excited, including folks across the border in China, even though crypto trading has been banned there since 2021.
The PBOC specifically called out stablecoins for not meeting customer identification and anti-money laundering requirements. Big Chinese tech companies like Ant Group and JD.com already paused their stablecoin plans in Hong Kong earlier after getting pressure from regulators.
Conclusion
Hong Kong crypto stocks plunged as China’s central bank vowed a tougher crackdown on virtual assets and stablecoins, erasing hopes of policy easing and intensifying pressure on firms already facing regulatory pushback.
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