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Bitcoin Breaks $94,000: Reversal or Rebound? | Trader's Insight
Under the dual catalyst of a signal of easing tensions in U.S.-China trade and temporary relief in uncertainty surrounding the Fed's policies, Bitcoin has surged above $94,000 in the short term, once again igniting the market's enthusiasm for the "digital gold."
Related Reading: "Bitcoin Soars 7%, Is the 'Digital Gold' Narrative Back?"
This rally is not only a short-term response of the market to the warming of U.S.-China trade relations but more like a risk repricing under the superimposition of multiple macro signals. In this storm where policy games and hedging demands are intertwined, Bitcoin is once again seen as a capital "safe haven," with its price surge perhaps being a market's preemptive response to future inflation, U.S. dollar credit, and global geopolitical changes.
However, whether this round of price surge is the starting point of a structural reversal or a stage rebound driven by policy games remains a subject of significant market divergence.
On the one hand, both the funding and policy side have released positive signals of "risk repricing." The Trump administration's softened stance on tariff policies, the temporary "hands-off" approach to Powell, and Wall Street's high-profile participation in Bitcoin funds are all seen as the manifestation of the shifting roles between traditional safe-haven assets and digital assets. Institutions like QCP and Matrixport view Bitcoin's recent rise as an active price adjustment under a macro trend change, pointing out that funds are flowing from traditional assets like gold into the crypto market.
On the other hand, some technical analysts and seasoned traders remain cautious, believing that the current rally has not yet provided the structural confirmation needed for a trend reversal. From wave patterns, RSI indicators to liquidity-heavy areas, the signals of long and short positions are complexly intertwined, and the current market situation is closer to a strong rebound rather than a trend reversal. Consistent technical judgments emphasize that only if Bitcoin effectively breaks above $95,000 and stabilizes, a new round of bullish trend may be initiated.
Institutional Analysis
QCP Capital released its daily market analysis, stating that Cantor, SoftBank, Tether, and Bitfinex have jointly launched a bold Bitcoin acquisition fund named 21 Capital (tentative name). This move comes at a time when there is a decisive change in the U.S. policy stance, with the Trump administration leaning towards supporting the "digital gold" narrative, providing momentum to the cryptocurrency market.
Bitcoin has successfully surpassed the $90,000 psychological barrier. Meanwhile, gold has slipped by 6%, highlighting investors' renewed interest in risk assets and clearly showing a flow of funds into digital assets.
Institutional investors are no longer just testing the waters of cryptocurrency but diving in headfirst. As the Strategy strategy gradually fades away, 21 Capital is poised to become a new benchmark of cryptocurrency belief.
Macro risks still exist, but a key uncertainty seems to have been alleviated. Trump stated that there are currently no plans to replace Federal Reserve Chairman Powell, helping the U.S. long-term bond yields to slightly rebound and reducing a significant tail risk.
While the bond market remains stable, the U.S. stock market continues to hold at record highs, reflecting a more moderate and cautious market response. However, the overall outlook is far from simple. Trade frictions, geopolitical tensions, and regulatory uncertainties continue to cast a shadow over the market. Investors navigate in a rapidly changing environment, remaining highly sensitive to the next possible turning point.
Due to the recent warming of the market, speculative trading activity has increased, and open futures contracts have grown. Although Bitcoin has not yet broken through the key level of $95,000, as concerns about Trump's tariff comments diminish, the likelihood of this level being surpassed in the future is increasing. Bitcoin's current trend shows a certain upward trajectory.
CICC: High tariffs may trigger a "recession-style" rate cut by the Federal Reserve
Consider two scenarios: one where negotiations between the U.S. and its trade partners lack substantial progress, and 90 days later, the effective U.S. tariff rate remains high, with the income effect prevailing, leading to weakened economic demand prompting the Fed to cut rates starting from July, with a cumulative rate cut of up to 100 basis points for the year.
The other scenario is where negotiations are successful, tariffs are reduced, demand shocks under substitution effects are relatively mild, but inflation pressures are more sustainable, and the Fed may delay its easing pace, only making a slight rate cut once in December. For the market, even though monetary easing comes earlier in the first scenario, this "recession-style" rate cut reflects deteriorating economic fundamentals and may actually suppress risk assets.
Macro Insight
Last night, the market saw a significant surge, accompanied by three relaxations from the Trump administration:
1. At 11:59 PM; Bessent spoke at a closed-door meeting with J.P. Morgan investors, stating that the current situation is unsustainable and a de-escalation with China will happen soon, allowing the market to "breathe a sigh of relief." Chinese concept stocks soared, gold dipped slightly, and the Nasdaq rose. The Treasury Secretary deliberately chose to make a "private" statement to investors within a Wall Street investment bank like J.P. Morgan, demonstrating a high level of attention to market sentiment, allowing the most sensitive capital market participants to digest and position themselves before the formal announcement.
2. Around 1 AM, Politico reported that completing the negotiation may take several months. At this time, the White House laid the groundwork: White House Press Secretary Levitt said in a press conference that Trump is laying the foundation for a trade agreement with China, and the relationship with China is moving in the right direction. Levitt also stated that Trump "has the right to express dissatisfaction with the Fed" and its chairman Powell, believing that some of the Fed's actions are politically motivated.
3. At 5 AM, Trump said U.S. tariffs on China will be "substantially" reduced from the current 145% level, and tariffs will not drop to zero. China will be very pleased with the final tariff rate. Trump also said he has no intention of firing Powell and hopes to see him more proactive on the rate-cutting issue.
The three relaxations gradually pushed the market upwards. As discussed the day before yesterday, looking ahead, in the next week or two, the market will most likely continue to oscillate upwards as in the past two weeks. Because Trump and Bessent are still pushing for negotiations, the market still has expectations for a new trade agreement. At the same time, there are signs of desensitization to tariffs, so short-term sentiment recovery is also a driving force for the upside.
Sure enough, when Trump eases up, the market can't hold back. Although many friends are calling for a bullish return, I'm not sure if my perception is correct. Even now, I still feel that we are not quite at the point of a "bull return." Especially for the overall risk market, liquidity constraints still exist. I still believe that this is a rebound rather than a reversal. Of course, I may not be right.
Additionally, I don't think it's the right time to go short at the moment. Even though I believe it's just a rebound, I won't open a position during non-U.S. stock trading hours. I'll wait to see the reaction of U.S. investors after the U.S. stock market opens.
Furthermore, I want to reiterate that the trading difficulty in April is still significant. A high trading difficulty does not necessarily mean a price drop. It indicates that the long and short game is more complex, and many of the reasons for this game stem from event-driven sources, especially the biggest uncertainty of Trump.
An increase in difficulty does not equate to a bearish view. I am concerned that some friends may not understand this. I have explained this issue multiple times. If you have poor reading comprehension, don't blame me. Whether the difficulty in the second quarter is high or not no longer needs me to say. The volatility due to Trump's remarks is self-evident, not to mention the GDP data at the end of the month.
Technical Analysis
1. Qualitative: Before breaking through the previous high and forming an obvious continuous five-wave upward impulse wave, any uptrend should be considered a rebound rather than a reversal;
2. Waves: Currently, Bitcoin has completed three upward segments, with the first segment from 74508 to 86496, the second segment from 86496 to 83950, and the third segment from 83950 to the current level. The third segment is approaching a 1:1 ratio compared to the first segment, and it has reached the lower boundary of the M-shaped top formation;
3. Indicators: On the daily and sub-daily levels (12H-1H), the RSI indicator is overbought.
Regarding Bitcoin's price movement, even though there was a temporary signal of topping out around 7 a.m. on the 1-hour timeframe, it was quickly broken by subsequent strong bullish momentum. The price retraced without breaking below the 1-hour MA7, showing strength, and the overall range contracted upward without any divergence correction demand.
There was no sign of a topping-out signal even on the 4-hour chart. The hourly trend is overall strong, considering the current risk market conditions, there is likely to be a wave of upward movement after the U.S. stock market opens tonight. In the short term, there is temporarily no significant resistance nearby on the upside, so one must closely monitor short-term topping-out signals.
A topping-out signal on the upside and a bottoming-out signal on the downside follow the same logic. A rapid breakthrough accompanied by a long shadow, the second candle lower than the previous high but higher than the previous low, then first confirm the 1-hour topping-out/bottoming-out signal, and so on for the 4-hour and daily levels. For example, in the current market situation, there was an initial topping-out signal around 7 a.m., but the subsequent market continued to fluctuate upward, breaking the topping-out signal. There was no such signal on the 4-hour chart. Therefore, assuming the macro trend remains unchanged, the technical outlook still favors an oscillating uptrend.
The expected oscillating uptrend path was quickly invalidated, as the accelerated rally came sooner than anticipated! BTC directly nailed the orange line at the 4h average pressure level, wiping out almost all liquidity in the current range in the futures market...
Now, the key supply area is the range of 93k to 95k.
Since the price entered the orange average pressure zone, it's not quite realistic to attempt large-scale long positions in the short term, as that would be lifting the sedan chair for my trend-long positions.
However, short-term long positions can still be made with confidence. Unlike bear markets, uptrends often see a V-shaped rebound after acceleration. After acceleration, uptrends tend to establish a high-level range, continuously testing new highs upward until demand weakens, leading to a pullback.
In the short term, with the rapid rise of the channel, the upper boundary of the oscillation channel represented by the yellow line may become a potential retracement target (89k to 90k). In subsequent pullbacks, as long as the price does not fall below the yellow line and returns to within the oscillation channel, there will always be hope to break through 95,000.
As for the scenario where the retracement falls below the yellow line, let's wait until it actually happens.
The current market situation may have exceeded many people's expectations, but if you observe the price rebound from the bottom, followed by a consolidation phase with shrinking volume, and today's accelerated surge, this is a clear 2-stage ABC pattern, where the rise of A is approximately equal to the increase of C.
Therefore, subjectively, when the orange line coincides with the supply area, the price faces significant pressure and is unlikely to shoot up all at once. A moderate retracement and oscillation to absorb short-side liquidity, gradually grinding upwards, and absorbing supply could potentially lead to the final breakthrough.
Again, emphasize that the current market trend, in my view, is still a rebound, not a reversal. The price action more closely resembles oscillation within the 95k to 78k range;
So, when the price approaches the upper boundary of the range, try to refrain from chasing long positions in the long term. Only when the price definitively consolidates above the orange line and 95,000, could it be deemed the start of a stronger uptrend.
Although I have been tricked by such a false breakout before, I certainly won't preconceive that it will definitely fake out at 95k and then tumble; it's always best to take it step by step and see how it plays out!
$BTC Technical Analysis Bullish Signal: Am I Bullish Again?
Technically speaking, or more precisely: from a trend structure perspective, BTC has shown a clear bullish signal on the daily chart.
Since I started operating on Twitter last December, I have been bearish all the way until now. As a dedicated bear, I feel it is necessary to come out and write an analysis,
to discuss my views on the upcoming market.
Previously, I shared my views on the S&P 500, and I introduced the "123 Rule" in the article. Interested readers can refer to it. At this moment, on the BTC daily chart, during yesterday's surge, it completed the "1." According to the 123 Rule, a trend reversal needs to meet 1, 2, 3, and the current BTC price has broken the previous Lower High (88.8K) to set a Higher High.
Next, if it can meet: "2: pullback without breaking the previous low, setting a Higher Low" + "3: set a new Higher High," then from the perspective of the 123 Rule, the trend reversal can be basically confirmed.
However, it must be emphasized that the above arguments are all based on the "technical" perspective.
As mentioned in the weekly reports I share, STH-RP has always been a major checkpoint to return to a bullish trend. The analytical logic of STH-RP can be referenced in this article.
Currently, the position of STH-RP is around 92,571. The current price has slightly surpassed STH-RP, and whether it can firmly hold this position will be the focus in the coming days. In addition, as mentioned in last week's report, from the perspective of URPD, it can also resonate with the viewpoint of STH-RP:
Currently, the information provided by URPD is as follows:
➡️ An accumulation of approximately 1.35 million BTC in the 81K to 85K range
➡️ 93 K still has a large amount of trapped chips above (detailed data can be seen in the weekly report)
Among them, the chips from 81 K to 85 K, are at least for now, mostly bought by relatively indecisive "short-term holders."
Therefore, when the price moves away from this range, these short-term holders will have a willingness to sell; at the same time, if the future price reaches the upper STH-RP position,
in addition to facing the suppression effect of STH-RP itself, there may also be a "deleveraging demand" for the trapped chips at 93 K.
Based on the above, the conclusions are as follows:
1️⃣ The position of STH-RP is the dividing line of the long and short trends, resonating with the perspective of URPD
2️⃣ If a strong breakthrough is not possible, it may create a disadvantageous situation for the bulls
3️⃣ If a strong breakthrough occurs, the bulls may take a leading position
In addition, if a real breakthrough is achieved, the accumulation range of 81-85 K, if not quickly consumed, may become a strong support for the bulls.
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China's Central Bank and Eight Other Departments' Latest Regulatory Focus: Key Attention to RWA Tokenized Asset Risk
Foreword: Today, the People's Bank of China's website published the "Notice of the People's Bank of China, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration for Market Regulation, China Banking and Insurance Regulatory Commission, China Securities Regulatory Commission, State Administration of Foreign Exchange on Further Preventing and Dealing with Risks Related to Virtual Currency and Others (Yinfa [2026] No. 42)", the latest regulatory requirements from the eight departments including the central bank, which are basically consistent with the regulatory requirements of recent years. The main focus of the regulation is on speculative activities such as virtual currency trading, exchanges, ICOs, overseas platform services, and this time, regulatory oversight of RWA has been added, explicitly prohibiting RWA tokenization, stablecoins (especially those pegged to the RMB). The following is the full text:
To the people's governments of all provinces, autonomous regions, and municipalities directly under the Central Government, the Xinjiang Production and Construction Corps:
Recently, there have been speculative activities related to virtual currency and Real-World Assets (RWA) tokenization, disrupting the economic and financial order and jeopardizing the property security of the people. In order to further prevent and address the risks related to virtual currency and Real-World Assets tokenization, effectively safeguard national security and social stability, in accordance with the "Law of the People's Republic of China on the People's Bank of China," "Law of the People's Republic of China on Commercial Banks," "Securities Law of the People's Republic of China," "Law of the People's Republic of China on Securities Investment Funds," "Law of the People's Republic of China on Futures and Derivatives," "Cybersecurity Law of the People's Republic of China," "Regulations of the People's Republic of China on the Administration of Renminbi," "Regulations on Prevention and Disposal of Illegal Fundraising," "Regulations of the People's Republic of China on Foreign Exchange Administration," "Telecommunications Regulations of the People's Republic of China," and other provisions, after reaching consensus with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, and with the approval of the State Council, the relevant matters are notified as follows:
(I) Virtual currency does not possess the legal status equivalent to fiat currency. Virtual currencies such as Bitcoin, Ether, Tether, etc., have the main characteristics of being issued by non-monetary authorities, using encryption technology and distributed ledger or similar technology, existing in digital form, etc. They do not have legal tender status, should not and cannot be circulated and used as currency in the market.
The business activities related to virtual currency are classified as illegal financial activities. The exchange of fiat currency and virtual currency within the territory, exchange of virtual currencies, acting as a central counterparty in buying and selling virtual currencies, providing information intermediary and pricing services for virtual currency transactions, token issuance financing, and trading of virtual currency-related financial products, etc., fall under illegal financial activities, such as suspected illegal issuance of token vouchers, unauthorized public issuance of securities, illegal operation of securities and futures business, illegal fundraising, etc., are strictly prohibited across the board and resolutely banned in accordance with the law. Overseas entities and individuals are not allowed to provide virtual currency-related services to domestic entities in any form.
A stablecoin pegged to a fiat currency indirectly fulfills some functions of the fiat currency in circulation. Without the consent of relevant authorities in accordance with the law and regulations, any domestic or foreign entity or individual is not allowed to issue a RMB-pegged stablecoin overseas.
（II）Tokenization of Real-World Assets refers to the use of encryption technology and distributed ledger or similar technologies to transform ownership rights, income rights, etc., of assets into tokens (tokens) or other interests or bond certificates with token (token) characteristics, and carry out issuance and trading activities.
Engaging in the tokenization of real-world assets domestically, as well as providing related intermediary, information technology services, etc., which are suspected of illegal issuance of token vouchers, unauthorized public offering of securities, illegal operation of securities and futures business, illegal fundraising, and other illegal financial activities, shall be prohibited; except for relevant business activities carried out with the approval of the competent authorities in accordance with the law and regulations and relying on specific financial infrastructures. Overseas entities and individuals are not allowed to illegally provide services related to the tokenization of real-world assets to domestic entities in any form.
(III) Inter-agency Coordination. The People's Bank of China, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of virtual currency-related illegal financial activities.
The China Securities Regulatory Commission, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of illegal financial activities related to the tokenization of real-world assets.
(IV) Strengthening Local Implementation. The people's governments at the provincial level are overall responsible for the prevention and disposal of risks related to virtual currencies and the tokenization of real-world assets in their respective administrative regions. The specific leading department is the local financial regulatory department, with participation from branches and dispatched institutions of the State Council's financial regulatory department, telecommunications regulators, public security, market supervision, and other departments, in coordination with cyberspace departments, courts, and procuratorates, to improve the normalization of the work mechanism, effectively connect with the relevant work mechanisms of central departments, form a cooperative and coordinated working pattern between central and local governments, effectively prevent and properly handle risks related to virtual currencies and the tokenization of real-world assets, and maintain economic and financial order and social stability.
(5) Enhanced Risk Monitoring. The People's Bank of China, China Securities Regulatory Commission, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration of Foreign Exchange, Cyberspace Administration of China, and other departments continue to improve monitoring techniques and system support, enhance cross-departmental data analysis and sharing, establish sound information sharing and cross-validation mechanisms, promptly grasp the risk situation of activities related to virtual currency and real-world asset tokenization. Local governments at all levels give full play to the role of local monitoring and early warning mechanisms. Local financial regulatory authorities, together with branches and agencies of the State Council's financial regulatory authorities, as well as departments of cyberspace and public security, ensure effective connection between online monitoring, offline investigation, and fund tracking, efficiently and accurately identify activities related to virtual currency and real-world asset tokenization, promptly share risk information, improve early warning information dissemination, verification, and rapid response mechanisms.
(6) Strengthened Oversight of Financial Institutions, Intermediaries, and Technology Service Providers. Financial institutions (including non-bank payment institutions) are prohibited from providing account opening, fund transfer, and clearing services for virtual currency-related business activities, issuing and selling financial products related to virtual currency, including virtual currency and related financial products in the scope of collateral, conducting insurance business related to virtual currency, or including virtual currency in the scope of insurance liability. Financial institutions (including non-bank payment institutions) are prohibited from providing custody, clearing, and settlement services for unauthorized real-world asset tokenization-related business and related financial products. Relevant intermediary institutions and information technology service providers are prohibited from providing intermediary, technical, or other services for unauthorized real-world asset tokenization-related businesses and related financial products.
(7) Enhanced Management of Internet Information Content and Access. Internet enterprises are prohibited from providing online business venues, commercial displays, marketing, advertising, or paid traffic diversion services for virtual currency and real-world asset tokenization-related business activities. Upon discovering clues of illegal activities, they should promptly report to relevant departments and provide technical support and assistance for related investigations and inquiries. Based on the clues transferred by the financial regulatory authorities, the cyberspace administration, telecommunications authorities, and public security departments should promptly close and deal with websites, mobile applications (including mini-programs), and public accounts engaged in virtual currency and real-world asset tokenization-related business activities in accordance with the law.
(8) Strengthened Entity Registration and Advertisement Management. Market supervision departments strengthen entity registration and management, and enterprise and individual business registrations must not contain terms such as "virtual currency," "virtual asset," "cryptocurrency," "crypto asset," "stablecoin," "real-world asset tokenization," or "RWA" in their names or business scopes. Market supervision departments, together with financial regulatory authorities, legally enhance the supervision of advertisements related to virtual currency and real-world asset tokenization, promptly investigating and handling relevant illegal advertisements.
（IX） Continued Rectification of Virtual Currency Mining Activities. The National Development and Reform Commission, together with relevant departments, strictly controls virtual currency mining activities, continuously promotes the rectification of virtual currency mining activities. The people's governments of various provinces take overall responsibility for the rectification of "mining" within their respective administrative regions. In accordance with the requirements of the National Development and Reform Commission and other departments in the "Notice on the Rectification of Virtual Currency Mining Activities" (NDRC Energy-saving Building [2021] No. 1283) and the provisions of the "Guidance Catalog for Industrial Structure Adjustment (2024 Edition)," a comprehensive review, investigation, and closure of existing virtual currency mining projects are conducted, new mining projects are strictly prohibited, and mining machine production enterprises are strictly prohibited from providing mining machine sales and other services within the country.
（X） Severe Crackdown on Related Illegal Financial Activities. Upon discovering clues to illegal financial activities related to virtual currency and the tokenization of real-world assets, local financial regulatory authorities, branches of the State Council's financial regulatory authorities, and other relevant departments promptly investigate, determine, and properly handle the issues in accordance with the law, and seriously hold the relevant entities and individuals legally responsible. Those suspected of crimes are transferred to the judicial authorities for processing according to the law.
（XI） Severe Crackdown on Related Illegal and Criminal Activities. The Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, as well as judicial and procuratorial organs, in accordance with their respective responsibilities, rigorously crack down on illegal and criminal activities related to virtual currency, the tokenization of real-world assets, such as fraud, money laundering, illegal business operations, pyramid schemes, illegal fundraising, and other illegal and criminal activities carried out under the guise of virtual currency, the tokenization of real-world assets, etc.
（XII） Strengthen Industry Self-discipline. Relevant industry associations should enhance membership management and policy advocacy, based on their own responsibilities, advocate and urge member units to resist illegal financial activities related to virtual currency and the tokenization of real-world assets. Member units that violate regulatory policies and industry self-discipline rules are to be disciplined in accordance with relevant self-regulatory management regulations. By leveraging various industry infrastructure, conduct risk monitoring related to virtual currency, the tokenization of real-world assets, and promptly transfer issue clues to relevant departments.
（XIII） Without the approval of relevant departments in accordance with the law and regulations, domestic entities and foreign entities controlled by them may not issue virtual currency overseas.
（XIV） Domestic entities engaging directly or indirectly in overseas external debt-based tokenization of real-world assets, or conducting asset securitization activities abroad based on domestic ownership rights, income rights, etc. (hereinafter referred to as domestic equity), should be strictly regulated in accordance with the principles of "same business, same risk, same rules." The National Development and Reform Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other relevant departments regulate it according to their respective responsibilities. For other forms of overseas real-world asset tokenization activities based on domestic equity by domestic entities, the China Securities Regulatory Commission, together with relevant departments, supervise according to their division of responsibilities. Without the consent and filing of relevant departments, no unit or individual may engage in the above-mentioned business.
(15) Overseas subsidiaries and branches of domestic financial institutions providing Real World Asset Tokenization-related services overseas shall do so legally and prudently. They shall have professional personnel and systems in place to effectively mitigate business risks, strictly implement customer onboarding, suitability management, anti-money laundering requirements, and incorporate them into the domestic financial institutions' compliance and risk management system. Intermediaries and information technology service providers offering Real World Asset Tokenization services abroad based on domestic equity or conducting Real World Asset Tokenization business in the form of overseas debt for domestic entities directly or indirectly venturing abroad must strictly comply with relevant laws and regulations. They should establish and improve relevant compliance and internal control systems in accordance with relevant normative requirements, strengthen business and risk control, and report the business developments to the relevant regulatory authorities for approval or filing.
(16) Strengthen organizational leadership and overall coordination. All departments and regions should attach great importance to the prevention of risks related to virtual currencies and Real World Asset Tokenization, strengthen organizational leadership, clarify work responsibilities, form a long-term effective working mechanism with centralized coordination, local implementation, and shared responsibilities, maintain high pressure, dynamically monitor risks, effectively prevent and mitigate risks in an orderly and efficient manner, legally protect the property security of the people, and make every effort to maintain economic and financial order and social stability.
(17) Widely carry out publicity and education. All departments, regions, and industry associations should make full use of various media and other communication channels to disseminate information through legal and policy interpretation, analysis of typical cases, and education on investment risks, etc. They should promote the illegality and harm of virtual currencies and Real World Asset Tokenization-related businesses and their manifestations, fully alert to potential risks and hidden dangers, and enhance public awareness and identification capabilities for risk prevention.
(18) Engaging in illegal financial activities related to virtual currencies and Real World Asset Tokenization in violation of this notice, as well as providing services for virtual currencies and Real World Asset Tokenization-related businesses, shall be punished in accordance with relevant regulations. If it constitutes a crime, criminal liability shall be pursued according to the law. For domestic entities and individuals who knowingly or should have known that overseas entities illegally provided virtual currency or Real World Asset Tokenization-related services to domestic entities and still assisted them, relevant responsibilities shall be pursued according to the law. If it constitutes a crime, criminal liability shall be pursued according to the law.
(19) If any unit or individual invests in virtual currencies, Real World Asset Tokens, and related financial products against public order and good customs, the relevant civil legal actions shall be invalid, and any resulting losses shall be borne by them. If there are suspicions of disrupting financial order and jeopardizing financial security, the relevant departments shall deal with them according to the law.
This notice shall enter into force upon the date of its issuance. The People's Bank of China and ten other departments' "Notice on Further Preventing and Dealing with the Risks of Virtual Currency Trading Speculation" (Yinfa [2021] No. 237) is hereby repealed.
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Foreword: Today, the People's Bank of China's website published the "Notice of the People's Bank of China, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration for Market Regulation, China Banking and Insurance Regulatory Commission, China Securities Regulatory Commission, State Administration of Foreign Exchange on Further Preventing and Dealing with Risks Related to Virtual Currency and Others (Yinfa [2026] No. 42)", the latest regulatory requirements from the eight departments including the central bank, which are basically consistent with the regulatory requirements of recent years. The main focus of the regulation is on speculative activities such as virtual currency trading, exchanges, ICOs, overseas platform services, and this time, regulatory oversight of RWA has been added, explicitly prohibiting RWA tokenization, stablecoins (especially those pegged to the RMB). The following is the full text:
To the people's governments of all provinces, autonomous regions, and municipalities directly under the Central Government, the Xinjiang Production and Construction Corps:
Recently, there have been speculative activities related to virtual currency and Real-World Assets (RWA) tokenization, disrupting the economic and financial order and jeopardizing the property security of the people. In order to further prevent and address the risks related to virtual currency and Real-World Assets tokenization, effectively safeguard national security and social stability, in accordance with the "Law of the People's Republic of China on the People's Bank of China," "Law of the People's Republic of China on Commercial Banks," "Securities Law of the People's Republic of China," "Law of the People's Republic of China on Securities Investment Funds," "Law of the People's Republic of China on Futures and Derivatives," "Cybersecurity Law of the People's Republic of China," "Regulations of the People's Republic of China on the Administration of Renminbi," "Regulations on Prevention and Disposal of Illegal Fundraising," "Regulations of the People's Republic of China on Foreign Exchange Administration," "Telecommunications Regulations of the People's Republic of China," and other provisions, after reaching consensus with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, and with the approval of the State Council, the relevant matters are notified as follows:
(I) Virtual currency does not possess the legal status equivalent to fiat currency. Virtual currencies such as Bitcoin, Ether, Tether, etc., have the main characteristics of being issued by non-monetary authorities, using encryption technology and distributed ledger or similar technology, existing in digital form, etc. They do not have legal tender status, should not and cannot be circulated and used as currency in the market.
The business activities related to virtual currency are classified as illegal financial activities. The exchange of fiat currency and virtual currency within the territory, exchange of virtual currencies, acting as a central counterparty in buying and selling virtual currencies, providing information intermediary and pricing services for virtual currency transactions, token issuance financing, and trading of virtual currency-related financial products, etc., fall under illegal financial activities, such as suspected illegal issuance of token vouchers, unauthorized public issuance of securities, illegal operation of securities and futures business, illegal fundraising, etc., are strictly prohibited across the board and resolutely banned in accordance with the law. Overseas entities and individuals are not allowed to provide virtual currency-related services to domestic entities in any form.
A stablecoin pegged to a fiat currency indirectly fulfills some functions of the fiat currency in circulation. Without the consent of relevant authorities in accordance with the law and regulations, any domestic or foreign entity or individual is not allowed to issue a RMB-pegged stablecoin overseas.
（II）Tokenization of Real-World Assets refers to the use of encryption technology and distributed ledger or similar technologies to transform ownership rights, income rights, etc., of assets into tokens (tokens) or other interests or bond certificates with token (token) characteristics, and carry out issuance and trading activities.
Engaging in the tokenization of real-world assets domestically, as well as providing related intermediary, information technology services, etc., which are suspected of illegal issuance of token vouchers, unauthorized public offering of securities, illegal operation of securities and futures business, illegal fundraising, and other illegal financial activities, shall be prohibited; except for relevant business activities carried out with the approval of the competent authorities in accordance with the law and regulations and relying on specific financial infrastructures. Overseas entities and individuals are not allowed to illegally provide services related to the tokenization of real-world assets to domestic entities in any form.
(III) Inter-agency Coordination. The People's Bank of China, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of virtual currency-related illegal financial activities.
The China Securities Regulatory Commission, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of illegal financial activities related to the tokenization of real-world assets.
(IV) Strengthening Local Implementation. The people's governments at the provincial level are overall responsible for the prevention and disposal of risks related to virtual currencies and the tokenization of real-world assets in their respective administrative regions. The specific leading department is the local financial regulatory department, with participation from branches and dispatched institutions of the State Council's financial regulatory department, telecommunications regulators, public security, market supervision, and other departments, in coordination with cyberspace departments, courts, and procuratorates, to improve the normalization of the work mechanism, effectively connect with the relevant work mechanisms of central departments, form a cooperative and coordinated working pattern between central and local governments, effectively prevent and properly handle risks related to virtual currencies and the tokenization of real-world assets, and maintain economic and financial order and social stability.
(5) Enhanced Risk Monitoring. The People's Bank of China, China Securities Regulatory Commission, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration of Foreign Exchange, Cyberspace Administration of China, and other departments continue to improve monitoring techniques and system support, enhance cross-departmental data analysis and sharing, establish sound information sharing and cross-validation mechanisms, promptly grasp the risk situation of activities related to virtual currency and real-world asset tokenization. Local governments at all levels give full play to the role of local monitoring and early warning mechanisms. Local financial regulatory authorities, together with branches and agencies of the State Council's financial regulatory authorities, as well as departments of cyberspace and public security, ensure effective connection between online monitoring, offline investigation, and fund tracking, efficiently and accurately identify activities related to virtual currency and real-world asset tokenization, promptly share risk information, improve early warning information dissemination, verification, and rapid response mechanisms.
(6) Strengthened Oversight of Financial Institutions, Intermediaries, and Technology Service Providers. Financial institutions (including non-bank payment institutions) are prohibited from providing account opening, fund transfer, and clearing services for virtual currency-related business activities, issuing and selling financial products related to virtual currency, including virtual currency and related financial products in the scope of collateral, conducting insurance business related to virtual currency, or including virtual currency in the scope of insurance liability. Financial institutions (including non-bank payment institutions) are prohibited from providing custody, clearing, and settlement services for unauthorized real-world asset tokenization-related business and related financial products. Relevant intermediary institutions and information technology service providers are prohibited from providing intermediary, technical, or other services for unauthorized real-world asset tokenization-related businesses and related financial products.
(7) Enhanced Management of Internet Information Content and Access. Internet enterprises are prohibited from providing online business venues, commercial displays, marketing, advertising, or paid traffic diversion services for virtual currency and real-world asset tokenization-related business activities. Upon discovering clues of illegal activities, they should promptly report to relevant departments and provide technical support and assistance for related investigations and inquiries. Based on the clues transferred by the financial regulatory authorities, the cyberspace administration, telecommunications authorities, and public security departments should promptly close and deal with websites, mobile applications (including mini-programs), and public accounts engaged in virtual currency and real-world asset tokenization-related business activities in accordance with the law.
(8) Strengthened Entity Registration and Advertisement Management. Market supervision departments strengthen entity registration and management, and enterprise and individual business registrations must not contain terms such as "virtual currency," "virtual asset," "cryptocurrency," "crypto asset," "stablecoin," "real-world asset tokenization," or "RWA" in their names or business scopes. Market supervision departments, together with financial regulatory authorities, legally enhance the supervision of advertisements related to virtual currency and real-world asset tokenization, promptly investigating and handling relevant illegal advertisements.
（IX） Continued Rectification of Virtual Currency Mining Activities. The National Development and Reform Commission, together with relevant departments, strictly controls virtual currency mining activities, continuously promotes the rectification of virtual currency mining activities. The people's governments of various provinces take overall responsibility for the rectification of "mining" within their respective administrative regions. In accordance with the requirements of the National Development and Reform Commission and other departments in the "Notice on the Rectification of Virtual Currency Mining Activities" (NDRC Energy-saving Building [2021] No. 1283) and the provisions of the "Guidance Catalog for Industrial Structure Adjustment (2024 Edition)," a comprehensive review, investigation, and closure of existing virtual currency mining projects are conducted, new mining projects are strictly prohibited, and mining machine production enterprises are strictly prohibited from providing mining machine sales and other services within the country.
（X） Severe Crackdown on Related Illegal Financial Activities. Upon discovering clues to illegal financial activities related to virtual currency and the tokenization of real-world assets, local financial regulatory authorities, branches of the State Council's financial regulatory authorities, and other relevant departments promptly investigate, determine, and properly handle the issues in accordance with the law, and seriously hold the relevant entities and individuals legally responsible. Those suspected of crimes are transferred to the judicial authorities for processing according to the law.
（XI） Severe Crackdown on Related Illegal and Criminal Activities. The Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, as well as judicial and procuratorial organs, in accordance with their respective responsibilities, rigorously crack down on illegal and criminal activities related to virtual currency, the tokenization of real-world assets, such as fraud, money laundering, illegal business operations, pyramid schemes, illegal fundraising, and other illegal and criminal activities carried out under the guise of virtual currency, the tokenization of real-world assets, etc.
（XII） Strengthen Industry Self-discipline. Relevant industry associations should enhance membership management and policy advocacy, based on their own responsibilities, advocate and urge member units to resist illegal financial activities related to virtual currency and the tokenization of real-world assets. Member units that violate regulatory policies and industry self-discipline rules are to be disciplined in accordance with relevant self-regulatory management regulations. By leveraging various industry infrastructure, conduct risk monitoring related to virtual currency, the tokenization of real-world assets, and promptly transfer issue clues to relevant departments.
（XIII） Without the approval of relevant departments in accordance with the law and regulations, domestic entities and foreign entities controlled by them may not issue virtual currency overseas.
（XIV） Domestic entities engaging directly or indirectly in overseas external debt-based tokenization of real-world assets, or conducting asset securitization activities abroad based on domestic ownership rights, income rights, etc. (hereinafter referred to as domestic equity), should be strictly regulated in accordance with the principles of "same business, same risk, same rules." The National Development and Reform Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other relevant departments regulate it according to their respective responsibilities. For other forms of overseas real-world asset tokenization activities based on domestic equity by domestic entities, the China Securities Regulatory Commission, together with relevant departments, supervise according to their division of responsibilities. Without the consent and filing of relevant departments, no unit or individual may engage in the above-mentioned business.
(15) Overseas subsidiaries and branches of domestic financial institutions providing Real World Asset Tokenization-related services overseas shall do so legally and prudently. They shall have professional personnel and systems in place to effectively mitigate business risks, strictly implement customer onboarding, suitability management, anti-money laundering requirements, and incorporate them into the domestic financial institutions' compliance and risk management system. Intermediaries and information technology service providers offering Real World Asset Tokenization services abroad based on domestic equity or conducting Real World Asset Tokenization business in the form of overseas debt for domestic entities directly or indirectly venturing abroad must strictly comply with relevant laws and regulations. They should establish and improve relevant compliance and internal control systems in accordance with relevant normative requirements, strengthen business and risk control, and report the business developments to the relevant regulatory authorities for approval or filing.
(16) Strengthen organizational leadership and overall coordination. All departments and regions should attach great importance to the prevention of risks related to virtual currencies and Real World Asset Tokenization, strengthen organizational leadership, clarify work responsibilities, form a long-term effective working mechanism with centralized coordination, local implementation, and shared responsibilities, maintain high pressure, dynamically monitor risks, effectively prevent and mitigate risks in an orderly and efficient manner, legally protect the property security of the people, and make every effort to maintain economic and financial order and social stability.
(17) Widely carry out publicity and education. All departments, regions, and industry associations should make full use of various media and other communication channels to disseminate information through legal and policy interpretation, analysis of typical cases, and education on investment risks, etc. They should promote the illegality and harm of virtual currencies and Real World Asset Tokenization-related businesses and their manifestations, fully alert to potential risks and hidden dangers, and enhance public awareness and identification capabilities for risk prevention.
(18) Engaging in illegal financial activities related to virtual currencies and Real World Asset Tokenization in violation of this notice, as well as providing services for virtual currencies and Real World Asset Tokenization-related businesses, shall be punished in accordance with relevant regulations. If it constitutes a crime, criminal liability shall be pursued according to the law. For domestic entities and individuals who knowingly or should have known that overseas entities illegally provided virtual currency or Real World Asset Tokenization-related services to domestic entities and still assisted them, relevant responsibilities shall be pursued according to the law. If it constitutes a crime, criminal liability shall be pursued according to the law.
(19) If any unit or individual invests in virtual currencies, Real World Asset Tokens, and related financial products against public order and good customs, the relevant civil legal actions shall be invalid, and any resulting losses shall be borne by them. If there are suspicions of disrupting financial order and jeopardizing financial security, the relevant departments shall deal with them according to the law.
This notice shall enter into force upon the date of its issuance. The People's Bank of China and ten other departments' "Notice on Further Preventing and Dealing with the Risks of Virtual Currency Trading Speculation" (Yinfa [2021] No. 237) is hereby repealed.
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