The cryptocurrency sector is being swept by an unprecedented dual regulatory 'hurricane'—Hong Kong's 'blood transfusion' of USDT, and the mainland's 'zero tolerance' stance on stablecoins. Behind this is China's differentiated regulatory approach of 'strict regulation onshore and promoting standards offshore,' which profoundly influences the landscape of the onshore and offshore stablecoin markets.

On November 28, 2025, the central bank, in conjunction with 13 departments, explicitly classified stablecoins as virtual currencies, integrating their related activities into the regulation of illegal financial activities; this marks the first national-level 'definition' for stablecoins.

Regulatory implementation involves an 'all-chain ban': Onshore issuance and trading of stablecoins are prohibited, cutting off funding channels such as banks, and cleaning up offshore platforms drawing in onshore traffic, with involved parties potentially facing criminal liability. From January to October 2025, the mainland has cracked down on 342 criminal cases involving stablecoins, intercepting 12,000 suspected transactions, involving 4.6 billion yuan, severing their money laundering and illegal cross-border fund transfer chains, and also aiding the promotion of the digital renminbi, which saw its cross-border payment scale exceed 10 trillion yuan that year.

Hong Kong, under the 'Stablecoin Ordinance' effective from August, has fully restricted retail trading of USDT due to Tether's failure to meet licensing requirements; only professional investors are allowed to participate. As of December, no stablecoin institutions have been granted licenses.

The Monetary Authority has set high thresholds, requiring non-bank institutions to have a capital of 25 million Hong Kong dollars and 100% high liquidity reserves, guiding stablecoin services to support the real economy, such as Caesar's Travel achieving real-time conversion of stablecoin consumption by overseas tourists into renminbi, improving settlement efficiency by 90%.

Under the mainland's 'zero tolerance' approach, the scale of onshore stablecoin trading has sharply declined, with USDT's 90% share in onshore virtual currency over-the-counter trading being shattered, and funds flowing toward digital renminbi or compliant offshore instruments. The 'blood transfusion' of USDT in Hong Kong has attracted the attention of institutions like Sequoia Capital.

This regulatory storm is reshaping the stablecoin market ecosystem, and its future direction is worth watching. #加密市场观察 #山寨季将至？