International Call for Shared Surveillance of Cryptocurrency Transactions by China
In the ever-evolving world of cryptocurrencies, regulators across the globe are taking significant strides towards establishing clear, coordinated frameworks for digital assets. This shift is marked by notable regional differences, as seen in the approaches of China, Hong Kong, and major financial centres like the United States.
China continues to maintain a strict ban on all cryptocurrency trading, mining, and issuance activities since 2021. The Chinese government has imposed harsh crackdowns on related activities to prevent financial risks and maintain monetary sovereignty. Instead, China focuses more on its central bank digital currency (CBDC), the digital yuan, rather than private cryptocurrencies.
On the other hand, Hong Kong has taken a more open but cautious approach. The territory has introduced stablecoin regulations and crypto licensing regimes targeted at consumer protection and market integrity. Hong Kong aims to become a financial hub for digital assets, introducing frameworks that require authorized issuers and compliance with anti-money laundering rules, reflecting ongoing regulatory developments similar to the U.S. GENIUS Act.
Major banks like HSBC and Standard Chartered have shifted cautiously toward embracing cryptocurrencies primarily through infrastructure and service provision rather than promoting trading. They focus on compliance with evolving regulations and partnering with regulated crypto firms. Both are increasing involvement in facilitating crypto custody and blockchain innovation under tight regulatory supervision, aligning with global regulatory efforts that emphasize protecting consumers and integrating crypto assets into traditional finance.
The United States passed the GENIUS Act in July 2025, a landmark regulation clarifying stablecoin issuance, requiring full reserve backing, monthly audits, and AML compliance. This Act is the first comprehensive legislation targeting stablecoins, aiming to stabilize consumer protection while fostering innovation.
The US Securities and Exchange Commission (SEC) has also initiated "Project Crypto," modernizing securities rules to adapt for blockchain and crypto assets, clarifying which digital assets qualify as securities and facilitating a regulatory environment that encourages innovation while protecting investors.
The European Union and Hong Kong have followed with their own regulatory frameworks for stablecoins and digital assets, emphasizing consumer protection and stablecoin issuer accountability while promoting innovation.
International coordination on cross-border monitoring of crypto assets is identified as a key priority by the People's Bank of China. The Bank's 2024 Financial Stability Report emphasizes the need for cryptocurrency market regulation. Some economies are amending existing laws or introducing new ones to regulate the cryptocurrency sector.
As Xiao Feng, CEO of HashKey Group, suggested, the pro-crypto stance of Donald Trump's administration could potentially influence China to lift its restrictions on the digital asset market. This global regulatory landscape reflects increasing efforts toward clear, coordinated frameworks, with notable regional differences, as countries strive to responsibly integrate cryptocurrencies into the financial system.
[1] Source: Financial Times, "Global Cryptocurrency Regulation: A Comparative Analysis," 2025 [2] Source: Coindesk, "US Senate Passes Landmark Stablecoin Bill: The GENIUS Act," 2025 [3] Source: Reuters, "SEC Launches 'Project Crypto' to Modernize Securities Rules for Blockchain Assets," 2025 [4] Source: Bloomberg, "HSBC and Standard Chartered Embrace Crypto Under Regulatory Scrutiny," 2025 [5] Source: Forbes, "Hong Kong's Cryptocurrency Regulatory Framework: Aiming to Become a Global Hub," 2025
- The business sector, especially banks like HSBC and Standard Chartered, are engaging with the cryptocurrency industry, focusing primarily on infrastructure provision and compliance with evolving regulations, as seen in their increased involvement in facilitating crypto custody and blockchain innovation, while being subject to tight regulatory supervision.
- The technology behind cryptocurrencies, such as blockchain, is subject to regulatory initiatives worldwide, with significant regulatory frameworks being established to ensure the industry's integration into traditional finance while maintaining consumer protection, as depicted by the GENIUS Act in the United States, the EU's regulatory framework for stablecoins, and Hong Kong's approach towards digital assets.
