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Mining Rig Prices Increase by 24% as Trump's Tariff Policy Hits US Bitcoin Mining Industry
Original Article Title: How Trump's Tariffs Will Affect Bitcoin Mining
Original Article Author: Jaran Mellerud
Original Article Translation: Deep Tide TechFlow
Trump's tariff policy will have a significant impact on the Bitcoin mining industry. Here is an analysis of the policy's impact on the industry.
On April 2nd, Trump announced comprehensive new tariffs on imported goods aimed at strengthening U.S. trade balance. The Southeast Asia region was hit the hardest, impacting the Bitcoin mining machine supply chain profoundly. This region is home to most of the major mining hardware manufacturers, including Bitmain, MicroBT, and Canaan.
Furthermore, as the U.S. holds 36% of the global hashrate, these tariffs could significantly affect miners' profitability, hardware prices in the U.S. and abroad, and the global hashrate distribution.
Before delving into the multifaceted impact of these tariffs on the Bitcoin mining industry, let's first briefly explain how tariffs work.
How Do Tariffs Work?
Tariffs are taxes imposed by the government on imported goods, usually aimed at protecting domestic industries by raising the prices of foreign products. When tariffs are in place, importers must pay a certain percentage of the declared value of the goods to customs upon entry.
For example, if a U.S. company imports $1,000 worth of electronics from China and the tariff rate is 54%, the importer must pay an additional $540 in tariffs, bringing the total import cost to $1,540. This increased cost is often passed on to consumers or reduces the importer's profit margins.
Tariff History: The U.S.-China Trade War and Its Ripple Effects
Bitcoin mining is a global industry, with the U.S. being a significant player, and the trade war and resulting tariffs have already impacted the industry. However, in the past, companies in the industry have found ways to circumvent these tariffs. In the following section, we will explore how tariffs have historically affected the Bitcoin mining supply chain and what strategies companies have employed to bypass these tariffs.
In 2018, the U.S. government imposed a 25% tariff on a range of Chinese goods, including electronics, as part of the U.S.-China trade war.
In response, companies such as Bitmain began seeking ways to circumvent these high tariffs. They shifted their production from mainland China to Southeast Asian countries such as Indonesia, Thailand, and Malaysia, where exported goods to the US are either tariff-free or subject to lower tariffs—typically ranging from 1% to 3% for electronic products.
This strategy was effective until earlier this month when Trump raised tariffs on imports from Indonesia, Malaysia, and Thailand to 32%, 24%, and 36%, respectively. As a result, companies like Bitmain and MicroBT can no longer entirely avoid these high tariffs, which were initially targeted at goods imported from China.
In the following sections, we will elaborate on how these newly imposed tariffs will impact the Bitcoin mining industry.
Significant Price Increase Expected for Mining Machines in the US
The most direct and noticeable impact of the tariffs is that mining machine prices in the US are expected to increase significantly.
As Ethan Vera pointed out in "The Mining Pod" show: "...any company operating in the United States looking to purchase mining machines will need to pay an additional 22% to 36% for these machines." This aligns with our data.
However, the 22% price hike only applies to imported mining machines. Currently, there is still a substantial amount of mining machine inventory in the US. Based on Bitmars' pricing data, there is a 13% to 25% price difference between mining machines in the US and those in Hong Kong. As the US inventory diminishes, this price difference could narrow to 22%, plus a small shipping cost.
The graph above shows the final cost of importing a $1000 Bitcoin mining device into the US and Finland before and after the introduction of equivalent tariffs. Finland, like most other countries, has no tariffs on electronics imported from Asia—we use it as an example because we mine there.
As shown in the graph, due to approximately 2% tariff, the initial cost of importing a mining machine to the US was slightly higher. However, after the introduction of the new tariffs, the lowest cost of a $1000 mining machine in the US increased to $1240. This is a significant increase. Meanwhile, in Finland and most other countries, the cost of a $1000 mining machine remains the same due to the absence of tariffs.
In an industry as cost-sensitive as Bitcoin mining, a 22% increase in mining machine prices may render operations financially unsustainable. In the subsequent sections of this article, we will explore how these changes affect mining profitability in the US compared to other regions.
Mining Machines Outside the US May Become Cheaper
As mining machine prices within the US rise, prices of mining machines in other parts of the world may see an opposite downward trend.
The demand for mining machines shipped to the US is expected to plummet, possibly approaching zero. Given the US has been a dominant player in the ASIC (Application-Specific Integrated Circuit) market, representing nearly 40% of the global hashrate, the sharp decline in US purchases will lead to a significant drop in global demand.
With reduced demand from US miners, manufacturers will face an oversupply of inventory originally intended for the US market. To clear this surplus stock, they may need to lower prices to attract buyers from other regions.
While it's difficult to precisely predict how much mining machine prices will drop—since mining profitability also impacts prices—we can draw a conclusion based on fundamental economic principles: a decrease in demand for an asset usually leads to a price drop.
This price drop will make it easier for miners outside the US to expand further, which may also result in the decline of the US's share in global hashrate that we will discuss next.
US Share in the Global Bitcoin Mining Industry Will Decline
Since China banned Bitcoin mining in 2021, the US has been a dominant force in Bitcoin mining. According to data from Hashrate Index, the US currently holds 36% of the global hashrate.
Like any business activity, the core of Bitcoin mining lies in balancing risk and reward. Over the past four years, the US has attracted significant mining investment as it is seen as one of the lowest-risk environments in the world, with political stability, abundant energy, and a liberalized electricity market. Additionally, miners have so far avoided major import tariffs, helping them control capital expenditures. These factors together have created an unparalleled risk-reward balance.
To understand how new tariffs are reshaping the US's share in global mining, we first analyze from the perspective of returns.
The following graph shows the estimated payback period for deploying an Antminer S21+ in the US and a country unaffected by tariffs. As the data shows, overpaying by 24% for the same mining machine in the US significantly extends the payback period—undermining the core economic rationale for mining in the US.
In addition to the higher mining machine cost, the risk aspect has also been impacted. Many US miners felt reassured during the Trump administration, expecting a stable regulatory environment. But they are now experiencing the flip side of his policy volatility. Even if these tariffs are rescinded within months, the damage has been done—the confidence in long-term planning has been shaken. In a scenario where key variables could change overnight, few are willing to make significant investments.
In any case, the once unparalleled risk-return balance of U.S. Bitcoin mining has significantly deteriorated. This change could lead to a gradual decline in the U.S.' share of the global mining industry relative to other countries.
Of course, existing mining machines already imported into the U.S. will not be affected—miners have no reason to shut them down. However, the path to expansion has now become steep and filled with uncertainty.
Meanwhile, miners in tax-free jurisdictions will continue to scale up, solidifying their competitive advantage. Therefore, it is expected that the U.S.' global hash rate share will decrease—not because miners are exiting, but because they are no longer growing.
From a broader perspective, this could lead to a more diverse geographical distribution of Bitcoin mining than ever before. While the U.S. will still be a major player, its dominance will weaken, and the global hash rate distribution will become more balanced. This aligns with predictions from Braiins' Kristian Csepcar and Bitmars' Summer Meng.
Network Hash Rate Growth Will Slow Down
In the previous section, we explained how the new tariffs could lead to a decrease in the U.S.' share of the global Bitcoin mining industry. Given the U.S.' significant role in global hash rate, its slowdown—or even halt—in growth will inevitably result in an overall deceleration of global hash rate growth.
According to Hashrate Index data, as of the second quarter of 2025, the U.S. accounts for approximately 36% of the global hash rate. In contrast, CBECI data shows that as of January 2022, the U.S.' hash rate share was around 38%. This suggests that over the past three years, the growth rate of the U.S. mining industry has been roughly in line with other regions worldwide.
If this growth trajectory were to continue, the U.S. would contribute around 36% to future global hash rate growth. Therefore, if the U.S. mining industry stagnates due to tariffs' impact, it could lead to a reduction in the global hash rate growth rate of up to 36%.
However, the likelihood of a complete halt in U.S. mining industry growth is very low. As we will explain in the next section, these tariffs may be temporary, and there may be ways to circumvent them in the future. Therefore, the more realistic expectation is that the U.S. mining industry will continue to expand, but at a much slower pace than before. The assumption of a 36% reduction in global hash rate growth should be seen as an absolute upper limit—the actual impact may be slightly lower.
In the long run, if U.S. growth slows down or stalls, miners from other countries may accelerate their expansion to gradually fill this gap.
Nevertheless, in the short to medium term—within the next year or two—we may see global hash rate growth slower than previously expected. In an industry where slower hash rate growth translates to higher earnings, this will be a welcome development for miners worldwide.
Is This Temporary or Permanent?
So far, this article has taken a rather pessimistic view of how these tariffs could impact the U.S. Bitcoin mining industry—an outlook that is understandable given the immediate and severe effects they could bring about. However, the situation is more nuanced, and there are some crucial questions worth exploring.
In the following sections, we will address these questions and assess how the long-term prospects of the U.S. mining industry could cope with the current challenges.
Will Trump repeal the tariffs after implementing them for a few months?
It is entirely possible—especially considering the unpredictable and reactive nature of Trump's policy-making style. If the tariffs are repealed, U.S. miners would once again be able to import mining equipment at competitive prices, alleviating many of the immediate pressures they face.
However, the damage to long-term investor confidence may already have been done. Even if the tariffs are lifted, the sudden introduction of them has made large-scale, long-term investments in the U.S. mining industry more challenging. In a capital-intensive industry like Bitcoin mining, policy stability is crucial—and right now, that is in short supply.
Can mining equipment manufacturers circumvent the tariffs by importing chips from China Taiwan and assembling the miners in the U.S.?
Mining equipment manufacturers may indeed circumvent the tariffs by importing chips from China Taiwan and assembling miners locally in the U.S. According to the White House's official statement, semiconductors are not subject to the reciprocal tariffs. This means that chips can be imported into the U.S. duty-free. However, local production of miners in the U.S. still requires other components, many of which have become more expensive due to tariffs, leading to overall economic inflation in the U.S.
Currently, manufacturers like MicroBT have established assembly lines in the U.S., but Bitmain has yet to follow suit. Even with MicroBT's assembly capabilities, their production capacity is far from sufficient to meet U.S. demand for miners in the next 1-2 years.
Therefore, while this option is technically viable, it does not address the immediate concerns of U.S. miners. However, in the long run, we anticipate more miner assembly gradually shifting to the U.S. as manufacturers adapt to the new tariff environment and expand local production capacity. This transition may help reduce reliance on international imports and lessen the impact of tariffs over time.
Is it realistic to establish a complete Bitcoin mining hardware supply chain in the United States from chip manufacturing to final assembly?
Establishing a full Bitcoin mining hardware supply chain in the United States from chip manufacturing to final assembly is a complex challenge, despite strong advocacy from the Bitcoin mining industry and political leaders for localized chip production. Currently, the most advanced chips used in Bitcoin mining are manufactured in Taiwan and South Korea, regions with decades of expertise and finely tuned supply chains. The United States' reliance on key components from Asian countries poses a significant geopolitical risk not only to the Bitcoin mining industry but to the entire high-tech sector.
While localizing mining rig assembly in the U.S. is feasible, continued dependency on imported chips remains a major hurdle. Companies like Bitmain, MicroBT, and Canaan could establish assembly lines in the U.S., with new players such as Auradine also eyeing this market. However, without domestically produced cutting-edge chips, these manufacturers will still rely on imports in the foreseeable future.
Kristian Csepcsar from Braiins further emphasized this challenge, saying: "Chip foundries have started setting up manufacturing facilities in the U.S., but they are starting from a high nanometer level. It takes years to nurture talent and expertise to transition to lower nanometer levels. This is a progressive process—companies start with high nanometer chips to ensure a return on investment, then strive to expand to more advanced technology. Even as the U.S. progresses, establishing a fully localized Bitcoin mining hardware supply chain is nearly impossible due to the high costs. The real question is, if demand is high, whether it is still cheaper to manufacture in China and pay tariffs. After all, starting end-to-end manufacturing in the U.S. requires time and substantial investment, just as Bitmain recently attempted to set up assembly lines in China—although there has been little news since."
In summary, while the U.S. has great potential in assembly and chip manufacturing, a fully localized Bitcoin mining hardware supply chain remains a long-term goal rather than a short-term reality. The cost, time, and complexity of this transition make it unlikely to be achieved on a large scale in the coming years.
Conclusion
In conclusion, the newly implemented import tariffs will significantly impact the U.S. Bitcoin mining industry—leading to price increases for hardware, a decrease in U.S. market share, and a slowdown in global hash rate growth—but the long-term implications are more intricate.
As events unfold, miners and industry stakeholders need to closely monitor the political and economic landscape to address potential tariff and policy changes. The U.S. mining industry may face challenges in the short term, but there are still opportunities for growth and adaptation within the global mining ecosystem.
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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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