PBoC issues a notice on further preventing and handling of risks related to virtual currencies

• Will continue to crack down on crypto mining and related illegal financial activities.
• Without regulatory approval, domestic entities and their offshore units are prohibited from issuing virtual currencies overseas.
• Virtual currencies lack legal tender states, related activities are illegal financial activities.

The PBoC's announcement emphasizes its ongoing commitment to curtail crypto activities, reinforcing a hawkish stance against virtual currencies. This regulatory crackdown could impact risk sentiment in the market, particularly for assets tied to cryptocurrencies, while also influencing the yuan's stability versus other currencies. Traders should monitor broader implications for capital flows and potential volatility in related sectors.