Strengthen silver-tax interactions! China encourages banks to use blockchain, but ordinary people trading coins and tokenizing everything is all illegal.

The Chinese government encourages banks to adopt blockchain to strengthen “tax-and-credit interaction” to help companies obtain financing, but at the same time it has comprehensively prohibited the public from trading in cryptocurrencies and mining, and has classified stablecoins and tokenization as illegal, clearly separating official technology use from private speculation and hype.

China encourages institutions to adopt blockchain to deepen the tax-and-credit interaction model

The State Taxation Administration and the National Financial Regulatory Administration have recently jointly issued the “Notice on Further Deepening and Regulating ‘Tax-and-Credit Interaction’ Work,” mainly targeting provincial and municipal tax authorities and major banks. The goal is to improve the lending environment for private-sector and small and medium-sized enterprises.

Local tax authorities and banks are encouraged to, in accordance with the law, use blockchain and privacy computing technologies to innovate the tax-and-credit interaction model. The authorities require banks and taxpayers to achieve standardized data sharing, eliminating information asymmetry among the three parties: tax authority, bank, and enterprise.

The official also requires banks to improve credit models, enhance review efficiency, expand financing supply for honest taxpayers, and at the same time explicitly require the implementation of data security and enterprise authorization management.

Blockchain technology enables tax authorities and financial institutions to share data in a tamper-resistant environment, reducing paper-based work and further accelerating the process of risk assessment and financing approval.

China cracks down on cryptocurrencies, mining, stablecoins, and tokenization

Before rolling out blockchain applications, the Chinese government has already strictly prohibited people from engaging in cryptocurrency activities. In early 2026, eight departments including the People’s Bank of China issued a notice reiterating that cryptocurrencies have no legal status as legal tender, and that trading and mining activities within Chinese territory are comprehensively banned.

The authorities also, for the first time, set real-world asset (RWA) tokenization and stablecoin arrangements as illegal financial activities. If RWA tokenization is carried out within China or intermediary services are provided, it is suspected of illegal fundraising.

Zhang Jun, President of the Supreme People’s Court of China, declared that the country will severely punish crimes of money laundering involving cryptocurrencies. Meanwhile, BitChat, an end-to-end privacy communications app launched by Twitter founder and Block CEO Jack Dorsey (Jack Dorsey), has also been removed from China’s Apple App Store.

• **Related report:**China bans RWA innovation! Stablecoins, tokenization, and mining are all labeled “illegal financial activity”

China is cutting off blockchain infrastructure and private cryptocurrency speculation

While banning people from cryptocurrency activities, the Chinese government is encouraging small and medium-sized enterprises to adopt blockchain technology. This reveals a clear policy boundary.

This push to upgrade tax-and-credit interaction technology shows that China views data as a core production factor, a national strategic goal. It hopes to use blockchain’s tamper-resistant characteristics to address the financing difficulties faced by the real economy.

But toward private cryptocurrency and tokenized assets, the official stance is extremely tough, and it is also strictly preventing the speculation and operational risks brought by tokenization.

Overall, the stance of the Chinese government is to bring the underlying blockchain technology under official regulatory applications, thereby improving the efficiency of real-economy financial operations and, at the same time, firmly blocking any private cryptocurrency trading and token issuance activities that could jeopardize financial order.