Author Profile
Liu Yang
2022 LEGALBAND Recommended Top 15 Digital Economy Lawyers
2024, 2025 THE LEGAL 500 China List "Fintech" Area Recommended Lawyer
2024 THE LEGAL 500 Fintech Lawyer of the Year Nominee
2025 LEGALBAND Client Choice: Top 15 Fintech Lawyers
2026 THE LEGAL 500 Asia Pacific List: Fintech Area Recommended Lawyer
Two cases handled received LEGAL ONE "Exemplary Level" rating
February 6, 2026, originally thought to be a very ordinary day before the New Year. In the morning, Bitcoin plummeted significantly, approaching the $60,000 mark at its lowest point. In the evening, the People's Bank of China, 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 National Financial Regulatory Administration, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and eight other departments jointly issued the "Notice on Further Preventing and Disposing of Virtual Currency and Related Risks" (Yin Fa [2026] No. 42, hereinafter referred to as the "2.6 Notice"). "2.6" is destined to be recorded in the annals of virtual currency history and also seems to explain the reason for this crash.
1. Different from previous regulatory documents such as the 94 Announcement and the 924 Notice, this 2.6 Notice adds one item at the end: This Notice shall take effect from the date of issuance. The "Notice on Further Preventing and Disposing of Virtual Currency Trading Speculation Risks" (Yin Fa [2021] No. 237) issued by the People's Bank of China and ten other departments is simultaneously repealed. Repealing previous regulatory documents is a first in the history of virtual currency regulation.
At the end of last year's Financial Street Forum, Central Bank Governor Pan Gongsheng specifically mentioned stablecoins and RWA, while also emphasizing that the regulatory policies since 2017 are still effective. Now, eight departments jointly issued a document, repealing the 924 Notice, so the earlier regulatory document, the 94 Announcement, should naturally also be repealed.
Judging from the titles, the 924 Notice is the "Notice on Further Preventing and Disposing of Virtual Currency Trading Speculation Risks," highlighting trading speculation risks, while the 2.6 Notice is simply summarized as "Virtual Currency and Related Risks," with a clearly broader coverage.
2. Looking at the issuing units again, compared to the ten-department 924 Notice, this 2.6 Notice lacks the Supreme People's Procuratorate and the Supreme People's Court, which actually greatly exceeded the author's expectations. Since 2024, the Two Supremes have successively stepped in, using research on handling cases involving virtual currency as a starting point, carrying out a large amount of work. In the author's view, the legal policy regarding the handling of cases involving virtual currency was also expected to be the earliest virtual currency-related law or regulation to be introduced. It was also clearly proposed at the Central Political and Legal Affairs Commission meeting that preemptive research and legislation should be conducted on virtual currency, making the absence of the Two Supremes even more unexpected.
However, the 2.6 Notice also clearly states that it was "reached unanimously with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, and agreed upon by the State Council." This kind of statement has not appeared in previous virtual currency regulatory documents. The specific reasons and intentions are temporarily uninterpretable. My understanding is: agreement in principle on the relevant content, the specific wording might not yet be finalized.
3. Compared to previous statements, the biggest breakthrough of the 2.6 Notice is that it explicitly states for the first time: "Stablecoins pegged to fiat currency, in circulation and use, partially perform the functions of fiat currency. Without the lawful and regulatory approval of the relevant departments, any unit or individual, domestic or foreign, shall not issue stablecoins pegged to the RMB outside China."
The second half of this sentence is not difficult to understand; the literal meaning is very clear. The most crucial part is the first half: "partially perform the functions of fiat currency." As a criminal defense lawyer, the author is most concerned about whether, in judicial practice, this will be used as a basis to consider the exchange between fiat currency and stablecoins as 'disguised foreign exchange trading'? It must be known that disguised foreign exchange trading constitutes the crime of illegal business operation, and the crime of illegal business operation can be combined with a fine of one to five times the illegal gains, and the illegal gains are turned over to the state treasury. This clause targets OTC; the key is to see whether it will be implemented in a way that is excessive, biased, or intensified during the specific implementation process. If the force is too strong, the risk for the entire OTC industry will surge. As is well known, OTC is an indispensable industry in the virtual currency field.
4. Regarding RWA, in a word, within China, it is strictly prohibited. Domestic entities are strictly prohibited from engaging in it. Foreign companies and individuals are also not allowed to target domestic entities or provide services to domestic entities.
However, whether it can be targeted at overseas activities leaves an opening. The CSRC issued the "Regulatory Guidelines for the Domestic Asset Issuance of Asset-Backed Security Tokens Overseas," which will be interpreted later.
5. Compared to previous regulatory documents, the 2.6 Notice uses a larger篇幅 to regulate sound working mechanisms, strengthen risk monitoring, prevention, and disposal.
First, 8+3, central and local management. Eight departments, together with the Cyberspace Administration of China, the Supreme Procuratorate, and the Supreme Court, coordinate and guide各地区 to carry out risk prevention and disposal work for virtual currency-related illegal financial activities.
Second, strengthen属地 implementation, form a working pattern of central-local coordination and block combination, actively prevent and properly handle issues, maintain economic and financial order and social stability.
Third, strengthen risk monitoring, continuously improve monitoring technical means and system support, strengthen cross-departmental comprehensive research, judgment and sharing, establish a sound information sharing and cross-verification mechanism, provincial-level people's governments fully play the role of local monitoring and early warning mechanisms, local financial management departments, together with State Council financial management department branch offices, dispatched agencies, and cyberspace, public security and other departments, do a good job in effective dovetailing of online monitoring, offline investigations, and fund monitoring, efficient and accurate identification, and establish a quick response mechanism for investigation and disposal. Technology companies may usher in a spring of business explosion.
Fourth, strengthen the management of financial, intermediary, technical and other service institutions, virtual currency and related financial products shall not be included in the scope of collateral. Strengthen the management of internet information content and access, and provide technical support and assistance for relevant investigations and detection work. Strengthen the management of business entity registration and advertising. Continue to rectify virtual currency "mining" activities. Close存量, strictly prohibit增量. Severely crack down on related illegal financial activities, transfer suspects involved in crimes to judicial organs for handling according to law. Severely crack down on virtual currency, real-world asset tokenization-related fraud, money laundering, illegal business operation, pyramid schemes, illegal fundraising and other illegal and criminal activities, as well as related illegal and criminal activities carried out under the banner of virtual currency, real-world asset tokenization, etc.
6. Domestic entities going overseas to carry out related business自带原罪. First, cannot issue virtual currency, not even issuing it overseas. Second, domestic entities engaging in RWA should be supervised according to the principle of "same business, same risks, same rules." Third, overseas subsidiaries and branch institutions of domestic financial institutions providing RWA overseas must comply with certain requirements, which counts as leaving an opening, but it must be clear that this opening is left for financial institutions.
7. Compared to previous regulatory policies, the text of the 2.6 Notice newly adds "Legal Liability." The literal meaning is not complicated and will not be over-interpreted.
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