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Caroline Ellison was released today. What role did she play in the FTX collapse back then?
Original Title: ''Queen Caroline': The 'Fake Charity Nerd Girl' Behind The FTX Collapse'
Original Authors: David Jeans, Sarah Emerson, Richard Nieva, Michael del Castillo, Forbes
Original Translation: Katie Gu, Odaily Planet Daily
BlockBeats Note: This article was first published on November 19, 2022. Today (January 21), according to the latest records from the Federal Bureau of Prisons, Caroline Ellison, former Co-CEO of Alameda Research, will conclude her community confinement and be formally released.
In 2024, she was sentenced to 2 years of federal imprisonment by a U.S. court. In October 2025, she was transferred from a Connecticut federal prison to community confinement. In December 2025, Caroline Ellison reached a final settlement with the U.S. SEC and was simultaneously hit with a 10-year ban on executive and director roles.
For a long time, Caroline's personal image has been shrouded under the label of 'SBF's ex-girlfriend.' However, in the collapse of the FTX empire, the role played by this math genius is far more complex than her personal relationships. This article provides an in-depth analysis of her family background, growth path, and the true footnote she left in the history of crypto's earth-shattering downfall. The original article is as follows:
FTX, in addition to SBF, has kept one of its key figures, Caroline Ellison, Co-CEO of Alameda, enigmatic. (Just today, an FTX spokesperson said FTX has fired Gary Wang, Caroline Ellison, and Nishad Singh.) Caroline Ellison is a risk-loving math genius and Harry Potter fan. She is also a significant player in the FTX collapse and the new darling of the alt-right.
In 2021, Caroline Ellison was asked if she had any advice for her younger self, to which she replied candidly and concisely: 'I would tell my younger self not to be so risk-averse and to trust myself more.' This was her comment in the previously unpublished Forbes 30 Under 30 Rich List application.
A year later, this statement was interpreted as the "epitaph" of one of the recent largest financial disasters, a disaster that Caroline herself was involved in leading. The Alameda led by Caroline is a core part of FTX's business landscape.
It is alleged that it was Alameda's speculative investments using FTX customer deposits that siphoned off billions of dollars without users' knowledge. It was also Alameda that concealed this scheme as the hedge fund ensured that its assets traded on FTX bypassed its own balance sheet. In a bankruptcy filing, FTX estimates it will have over a million creditors seeking compensation. They are reported to have been persuaded to put their life savings into the platform. Documents also show that Alameda Research issued three personal loans to FTX executives, with SBF borrowing $1 billion. While SBF owned 90% of the trading firm, it was Caroline Ellison who took the helm when both FTX and Alameda collapsed.
Little public information is available about Caroline, but through conversations with eight people who knew her and unpublished details from her October interview with Forbes last year, we pieced together an image of a quiet math nerd who rose through the ranks in the crypto world until FTX's bankruptcy. Over a few years, Caroline wholeheartedly participated in SBF's "bacchanal" of a financial frenzy, leading her into an ever-expanding whirlpool of bullshit, deceit, and despair. She did not respond to a request for comment on this article.
"There are many who are very intelligent but may not excel in the chaotic world of trading—especially in cryptocurrency." —Caroline Ellison, May 2022
Caroline Ellison was once a "star student." Ruth Ackerman, a math professor who taught Caroline at Stanford University ten years ago, described her as "smart, focused, and very mathematically gifted." She finds it unbelievable that Caroline got involved in one of the largest fraud cases of the past decade.
Ackerman said in an interview with Forbes, "I found out because people started contacting me on LinkedIn to have me revoke my endorsement of her computer science skills."
Now, as the tragedy of FTX's bankruptcy increasingly captures public attention, with multiple U.S. agencies, including the SEC and the Department of Justice, announcing investigations, Caroline seems to be heading towards a nadir, her adventurous nature leading to catastrophic consequences.
She stated in a podcast episode in May, "Being able to face risks head-on is very important. Many people are very smart but may not excel in the chaotic trading world, especially in the cryptocurrency space."
"Their goal is to maximize wealth. They have never lived in a world without risk." — Early Alameda Employee
In March 2018, while working at the quantitative trading firm Jane Street, Caroline Ellison was approached by a former colleague with a proposition that would change her life.
While having coffee in California, SBF recommended to her to join the new cryptocurrency hedge fund Alameda Research he was spearheading, which would leverage Bitcoin's price differences across various countries. SBF described it as a perfect arbitrage opportunity. This trade would help him achieve his goal of making billions and donating to charity.
Caroline shared in an unpublished interview with Forbes in October 2021, "I thought it sounded exciting at the time, but I really loved Jane Street, so leaving was a tough decision."
However, Caroline stepped out of her comfort zone and formally entered the cryptocurrency space.
SBF, the mastermind behind Alameda and FTX, spent two years at Alameda before creating FTX, establishing what he saw as a modern cryptocurrency exchange. When SBF decided to leave Alameda and focus all his energy on the rapidly growing FTX, Caroline took over as Alameda's co-CEO.
FTX's dramatic implosion, from being "asset rich" to bankruptcy within four days, shifted focus to Alameda's $10 billion assets and allegations that the company used FTX customer deposits for risky investments. Several once industry stalwart cryptocurrency companies now face a similar fate. While daily headlines have accused him of years of misconduct, the spotlight has shifted from SBF to his inner circle, bringing Caroline into the public eye as a rare female leader in a male-dominated industry.
In recent days, Caroline has faced intense criticism from cryptocurrency supporters, blaming her for Alameda's downfall. Amid the harsh critique, a group of people has come to her defense. A supporter of Caroline told Forbes that many of those defending Caroline are congregating on the peer-to-peer platform Urbit created by computer scientist Curtis Yarvin. They believe Caroline is a scapegoat and claim that former co-CEO Sam Trabucco was the hidden hand behind Alameda's internal collapse. Trabucco did not respond to a request for comment.
「It feels like we really don't know what we're doing.」 — Caroline Ellison upon joining Alameda
Caroline's father, Glenn Ellison, currently serves as the head of the Economics Department at MIT, and her mother, Sara Fischer Ellison, is a lecturer in the same department. She grew up in a digitally charged atmosphere in the suburbs of Boston. While other kids were playing with LEGO blocks, Caroline was learning Bayesian statistics before middle school. One year, instead of a birthday card, she gifted her father a research paper on the pricing of stuffed toys. In a previous interview with Forbes, Caroline said, "I definitely got exposed to a lot more economics earlier than most people."
Caroline is a natural mathematician, having participated in multiple math competitions for women. But her interests extend far beyond math. In her senior year of high school, she also received accolades in the Linguistics Olympiad. She is an avid reader and mentioned that her parents read her the first Harry Potter book at age 3, and she read the second book by herself at age 5. She claims to be a student of Ravenclaw, representing wisdom and wit.
In 2012, when Caroline arrived at Stanford University as a math major, her career aspirations were already well defined. While adjusting to university life, she posted daily reflections on Tumblr.
When asked by Forbes last year what she didn't learn in school that has been helpful to her in the real world, she replied, "Pretty much everything. Like taxes."
She did learn one thing — a philosophy known as effective altruism. Popular in Silicon Valley, the movement calls on individuals to maximize their impact on the world using data. It was pioneered by a group of philosophers, including Will MacAskill. SBF said it was he who convinced himself to use his earnings for good, and he later joined the charity arm of the FTX Future Fund, resigning just last week. At Stanford, Caroline joined the campus Effective Altruism club and became its vice president.
Now, there are questions arising about whether Caroline, SBF, and their cohorts truly believe in the principles of effective altruism or if it's an effective way to mask their alleged misconduct. In a private chat published by Vox on Wednesday, a journalist asked SBF if his ethical statements were "mostly a front," to which SBF admitted. Caroline, at one point, seemed to have renamed her blog to "Pseudo-Philanthropic Shut-In," perhaps showing a sense of ironic self-awareness.
“For us, having two people able to take ultimate responsibility for things is a good thing.” — Caroline Ellison, serving as Co-CEO of Alamedia alongside Sam Trabucco
After graduating from Stanford, Caroline became a trader at Jane Street, where she met SBF. They bonded over their shared interests in effective altruism.
In 2018, SBF convinced her to join Alameda, and Caroline realized she had walked into a chaotic startup. In an interview with Forbes, Caroline said, “We truly had no idea what we were doing.” There, she also met SBF’s close friends Nishad Singh, Gary Wang, and soon-to-join Sam Trabucco, who would all take on executive roles alongside SBF. They shared a common interest in effective altruism.
By the end of 2018, SBF moved the company’s headquarters from Berkeley, California to Hong Kong. According to a former employee, SBF believed the city offered a good regulatory environment and with companies like Binance and Crypto.com based there, Hong Kong was the obvious choice for Alameda. Over the next few months, the team shuttled between six WeWork spaces across the city, including one office dedicated solely to storing couches.
But SBF’s next move was already in motion, and with initial funding from Binance, he launched FTX in 2019. As Caroline immersed herself in Alameda and quickly became a standout figure in the crypto space, Caroline began to shine at the trading firm, eventually rising to become Co-CEO of Alameda alongside Trabucco in the summer of 2021. With daily trading volumes of around $5 billion, this role propelled Caroline to the forefront of the industry.
Soon after, Caroline and Trabucco were featured on the Forbes 30 Under 30 list. In an interview at the time, she said, “For us, having two people able to take ultimate responsibility for things is a good thing.”
“I think I’ve been quite fortunate in a lot of ways.” — Caroline Ellison, May 2022
Over the past two weeks, there have been various speculations about the relationship between Caroline and SBF, but SBF confirmed it in an interview with The New York Times, stating that the two are no longer involved. A report by CoinDesk mentioned that Caroline had been on multiple dates with SBF, they were roommates at one point, and their relationship was somewhat close, although the specifics remain unclear.
A few years ago, Caroline posted on Tumblr in an ambiguous serious tone, saying, "After exploring open relationships, she believed that everyone should have a ranking of their partners, people should know their place in the ranking, and higher-ranking should entail a vicious power struggle."
Just as ambiguous as executive relationships, the relationship between Alameda and FTX is also ambiguous, quickly overshadowing its sister company FTX. SBF has courted investors such as Sequoia Capital, NEA, and Lightspeed Venture Partners, FTX's customer deposits surged, surpassing 1 million users. Yet, sometimes even investors are unaware of Alameda's role.
According to FTX staff and employees of companies doing business with the exchange and Alameda, as Alameda gradually fades from people's view, Caroline has almost become invisible. A co-CEO of a project funded by Alameda told Forbes, "Despite having an investment relationship with the trading firm, they have never interacted with her. Moreover, in most cases, Caroline seems happy to stay behind the scenes.
According to a former Alameda employee, in April of this year when Trabucco stepped down as co-CEO, Caroline found herself with sole control of Alameda, and Trabucco left just a few months after publicly announcing his departure in August. On Twitter, Trabucco mentioned that the co-CEO role was "exhausting" and that he had recently "not been working at all." The former Susquehanna trader, who graduated from MIT a year after SBF, stated that in the past few months, he had "significantly reduced" his role and was about to leave.
Months later, everything began to fall apart. Last week, Binance CEO CZ announced that Binance would acquire FTX to rescue it from a liquidity crisis. However, following due diligence, Binance quickly pulled out of the deal, citing "improper handling of customer funds and alleged investigations by U.S. authorities." In just a few days, SBF's empire faced collapse, with several of his entities filing for bankruptcy, including Alameda.
Currently, the US SEC and Justice Department, as well as Bahamian local authorities, are investigating the matter. Regarding how Alameda lost all customer funds, FTX is alleged to have transferred funds to support the ailing firm. Reportedly, SBF's luxury penthouse in the Bahamas is set to be sold for $40 million. Caroline, once a key figure behind SBF, is now bearing the brunt of the blame.
There are online rumors that Caroline plans to flee from Hong Kong to Dubai, as Dubai has no extradition treaty with the US, but her current whereabouts are unknown. Her last public statement was two tweets on November 6, defending the company's balance sheet against external criticism.
6 months ago, during an interview with the crypto podcast El Momento, Caroline was asked if she would "make any changes" if she could go back in time. At that time, the so-called cryptocurrency winter had already begun to have a chilling effect on many companies and markets, but FTX still had solvency.
She laughed and said, "I would definitely stay the same. I feel like I've been quite fortunate in a way. I don't think if I went back, took a different path, it would lead to such a good outcome."
Original Article Link
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China's Central Bank and Eight Other Departments' Latest Regulatory Focus: Key Attention to RWA Tokenized Asset Risk
Foreword: Today, the People's Bank of China's website published the "Notice of the People's Bank of China, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration for Market Regulation, China Banking and Insurance Regulatory Commission, China Securities Regulatory Commission, State Administration of Foreign Exchange on Further Preventing and Dealing with Risks Related to Virtual Currency and Others (Yinfa [2026] No. 42)", the latest regulatory requirements from the eight departments including the central bank, which are basically consistent with the regulatory requirements of recent years. The main focus of the regulation is on speculative activities such as virtual currency trading, exchanges, ICOs, overseas platform services, and this time, regulatory oversight of RWA has been added, explicitly prohibiting RWA tokenization, stablecoins (especially those pegged to the RMB). The following is the full text:
To the people's governments of all provinces, autonomous regions, and municipalities directly under the Central Government, the Xinjiang Production and Construction Corps:
Recently, there have been speculative activities related to virtual currency and Real-World Assets (RWA) tokenization, disrupting the economic and financial order and jeopardizing the property security of the people. In order to further prevent and address the risks related to virtual currency and Real-World Assets tokenization, effectively safeguard national security and social stability, in accordance with the "Law of the People's Republic of China on the People's Bank of China," "Law of the People's Republic of China on Commercial Banks," "Securities Law of the People's Republic of China," "Law of the People's Republic of China on Securities Investment Funds," "Law of the People's Republic of China on Futures and Derivatives," "Cybersecurity Law of the People's Republic of China," "Regulations of the People's Republic of China on the Administration of Renminbi," "Regulations on Prevention and Disposal of Illegal Fundraising," "Regulations of the People's Republic of China on Foreign Exchange Administration," "Telecommunications Regulations of the People's Republic of China," and other provisions, after reaching consensus with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, and with the approval of the State Council, the relevant matters are notified as follows:
(I) Virtual currency does not possess the legal status equivalent to fiat currency. Virtual currencies such as Bitcoin, Ether, Tether, etc., have the main characteristics of being issued by non-monetary authorities, using encryption technology and distributed ledger or similar technology, existing in digital form, etc. They do not have legal tender status, should not and cannot be circulated and used as currency in the market.
The business activities related to virtual currency are classified as illegal financial activities. The exchange of fiat currency and virtual currency within the territory, exchange of virtual currencies, acting as a central counterparty in buying and selling virtual currencies, providing information intermediary and pricing services for virtual currency transactions, token issuance financing, and trading of virtual currency-related financial products, etc., fall under illegal financial activities, such as suspected illegal issuance of token vouchers, unauthorized public issuance of securities, illegal operation of securities and futures business, illegal fundraising, etc., are strictly prohibited across the board and resolutely banned in accordance with the law. Overseas entities and individuals are not allowed to provide virtual currency-related services to domestic entities in any form.
A stablecoin pegged to a fiat currency indirectly fulfills some functions of the fiat currency in circulation. Without the consent of relevant authorities in accordance with the law and regulations, any domestic or foreign entity or individual is not allowed to issue a RMB-pegged stablecoin overseas.
（II）Tokenization of Real-World Assets refers to the use of encryption technology and distributed ledger or similar technologies to transform ownership rights, income rights, etc., of assets into tokens (tokens) or other interests or bond certificates with token (token) characteristics, and carry out issuance and trading activities.
Engaging in the tokenization of real-world assets domestically, as well as providing related intermediary, information technology services, etc., which are suspected of illegal issuance of token vouchers, unauthorized public offering of securities, illegal operation of securities and futures business, illegal fundraising, and other illegal financial activities, shall be prohibited; except for relevant business activities carried out with the approval of the competent authorities in accordance with the law and regulations and relying on specific financial infrastructures. Overseas entities and individuals are not allowed to illegally provide services related to the tokenization of real-world assets to domestic entities in any form.
(III) Inter-agency Coordination. The People's Bank of China, together with 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 China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of virtual currency-related illegal financial activities.
The China Securities Regulatory Commission, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of illegal financial activities related to the tokenization of real-world assets.
(IV) Strengthening Local Implementation. The people's governments at the provincial level are overall responsible for the prevention and disposal of risks related to virtual currencies and the tokenization of real-world assets in their respective administrative regions. The specific leading department is the local financial regulatory department, with participation from branches and dispatched institutions of the State Council's financial regulatory department, telecommunications regulators, public security, market supervision, and other departments, in coordination with cyberspace departments, courts, and procuratorates, to improve the normalization of the work mechanism, effectively connect with the relevant work mechanisms of central departments, form a cooperative and coordinated working pattern between central and local governments, effectively prevent and properly handle risks related to virtual currencies and the tokenization of real-world assets, and maintain economic and financial order and social stability.
(5) Enhanced Risk Monitoring. The People's Bank of China, China Securities Regulatory Commission, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration of Foreign Exchange, Cyberspace Administration of China, and other departments continue to improve monitoring techniques and system support, enhance cross-departmental data analysis and sharing, establish sound information sharing and cross-validation mechanisms, promptly grasp the risk situation of activities related to virtual currency and real-world asset tokenization. Local governments at all levels give full play to the role of local monitoring and early warning mechanisms. Local financial regulatory authorities, together with branches and agencies of the State Council's financial regulatory authorities, as well as departments of cyberspace and public security, ensure effective connection between online monitoring, offline investigation, and fund tracking, efficiently and accurately identify activities related to virtual currency and real-world asset tokenization, promptly share risk information, improve early warning information dissemination, verification, and rapid response mechanisms.
(6) Strengthened Oversight of Financial Institutions, Intermediaries, and Technology Service Providers. Financial institutions (including non-bank payment institutions) are prohibited from providing account opening, fund transfer, and clearing services for virtual currency-related business activities, issuing and selling financial products related to virtual currency, including virtual currency and related financial products in the scope of collateral, conducting insurance business related to virtual currency, or including virtual currency in the scope of insurance liability. Financial institutions (including non-bank payment institutions) are prohibited from providing custody, clearing, and settlement services for unauthorized real-world asset tokenization-related business and related financial products. Relevant intermediary institutions and information technology service providers are prohibited from providing intermediary, technical, or other services for unauthorized real-world asset tokenization-related businesses and related financial products.
(7) Enhanced Management of Internet Information Content and Access. Internet enterprises are prohibited from providing online business venues, commercial displays, marketing, advertising, or paid traffic diversion services for virtual currency and real-world asset tokenization-related business activities. Upon discovering clues of illegal activities, they should promptly report to relevant departments and provide technical support and assistance for related investigations and inquiries. Based on the clues transferred by the financial regulatory authorities, the cyberspace administration, telecommunications authorities, and public security departments should promptly close and deal with websites, mobile applications (including mini-programs), and public accounts engaged in virtual currency and real-world asset tokenization-related business activities in accordance with the law.
(8) Strengthened Entity Registration and Advertisement Management. Market supervision departments strengthen entity registration and management, and enterprise and individual business registrations must not contain terms such as "virtual currency," "virtual asset," "cryptocurrency," "crypto asset," "stablecoin," "real-world asset tokenization," or "RWA" in their names or business scopes. Market supervision departments, together with financial regulatory authorities, legally enhance the supervision of advertisements related to virtual currency and real-world asset tokenization, promptly investigating and handling relevant illegal advertisements.
（IX） Continued Rectification of Virtual Currency Mining Activities. The National Development and Reform Commission, together with relevant departments, strictly controls virtual currency mining activities, continuously promotes the rectification of virtual currency mining activities. The people's governments of various provinces take overall responsibility for the rectification of "mining" within their respective administrative regions. In accordance with the requirements of the National Development and Reform Commission and other departments in the "Notice on the Rectification of Virtual Currency Mining Activities" (NDRC Energy-saving Building [2021] No. 1283) and the provisions of the "Guidance Catalog for Industrial Structure Adjustment (2024 Edition)," a comprehensive review, investigation, and closure of existing virtual currency mining projects are conducted, new mining projects are strictly prohibited, and mining machine production enterprises are strictly prohibited from providing mining machine sales and other services within the country.
（X） Severe Crackdown on Related Illegal Financial Activities. Upon discovering clues to illegal financial activities related to virtual currency and the tokenization of real-world assets, local financial regulatory authorities, branches of the State Council's financial regulatory authorities, and other relevant departments promptly investigate, determine, and properly handle the issues in accordance with the law, and seriously hold the relevant entities and individuals legally responsible. Those suspected of crimes are transferred to the judicial authorities for processing according to the law.
（XI） Severe Crackdown on Related Illegal and Criminal Activities. The Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, as well as judicial and procuratorial organs, in accordance with their respective responsibilities, rigorously crack down on illegal and criminal activities related to virtual currency, the tokenization of real-world assets, such as fraud, money laundering, illegal business operations, pyramid schemes, illegal fundraising, and other illegal and criminal activities carried out under the guise of virtual currency, the tokenization of real-world assets, etc.
（XII） Strengthen Industry Self-discipline. Relevant industry associations should enhance membership management and policy advocacy, based on their own responsibilities, advocate and urge member units to resist illegal financial activities related to virtual currency and the tokenization of real-world assets. Member units that violate regulatory policies and industry self-discipline rules are to be disciplined in accordance with relevant self-regulatory management regulations. By leveraging various industry infrastructure, conduct risk monitoring related to virtual currency, the tokenization of real-world assets, and promptly transfer issue clues to relevant departments.
（XIII） Without the approval of relevant departments in accordance with the law and regulations, domestic entities and foreign entities controlled by them may not issue virtual currency overseas.
（XIV） Domestic entities engaging directly or indirectly in overseas external debt-based tokenization of real-world assets, or conducting asset securitization activities abroad based on domestic ownership rights, income rights, etc. (hereinafter referred to as domestic equity), should be strictly regulated in accordance with the principles of "same business, same risk, same rules." The National Development and Reform Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other relevant departments regulate it according to their respective responsibilities. For other forms of overseas real-world asset tokenization activities based on domestic equity by domestic entities, the China Securities Regulatory Commission, together with relevant departments, supervise according to their division of responsibilities. Without the consent and filing of relevant departments, no unit or individual may engage in the above-mentioned business.
(15) Overseas subsidiaries and branches of domestic financial institutions providing Real World Asset Tokenization-related services overseas shall do so legally and prudently. They shall have professional personnel and systems in place to effectively mitigate business risks, strictly implement customer onboarding, suitability management, anti-money laundering requirements, and incorporate them into the domestic financial institutions' compliance and risk management system. Intermediaries and information technology service providers offering Real World Asset Tokenization services abroad based on domestic equity or conducting Real World Asset Tokenization business in the form of overseas debt for domestic entities directly or indirectly venturing abroad must strictly comply with relevant laws and regulations. They should establish and improve relevant compliance and internal control systems in accordance with relevant normative requirements, strengthen business and risk control, and report the business developments to the relevant regulatory authorities for approval or filing.
(16) Strengthen organizational leadership and overall coordination. All departments and regions should attach great importance to the prevention of risks related to virtual currencies and Real World Asset Tokenization, strengthen organizational leadership, clarify work responsibilities, form a long-term effective working mechanism with centralized coordination, local implementation, and shared responsibilities, maintain high pressure, dynamically monitor risks, effectively prevent and mitigate risks in an orderly and efficient manner, legally protect the property security of the people, and make every effort to maintain economic and financial order and social stability.
(17) Widely carry out publicity and education. All departments, regions, and industry associations should make full use of various media and other communication channels to disseminate information through legal and policy interpretation, analysis of typical cases, and education on investment risks, etc. They should promote the illegality and harm of virtual currencies and Real World Asset Tokenization-related businesses and their manifestations, fully alert to potential risks and hidden dangers, and enhance public awareness and identification capabilities for risk prevention.
(18) Engaging in illegal financial activities related to virtual currencies and Real World Asset Tokenization in violation of this notice, as well as providing services for virtual currencies and Real World Asset Tokenization-related businesses, shall be punished in accordance with relevant regulations. If it constitutes a crime, criminal liability shall be pursued according to the law. For domestic entities and individuals who knowingly or should have known that overseas entities illegally provided virtual currency or Real World Asset Tokenization-related services to domestic entities and still assisted them, relevant responsibilities shall be pursued according to the law. If it constitutes a crime, criminal liability shall be pursued according to the law.
(19) If any unit or individual invests in virtual currencies, Real World Asset Tokens, and related financial products against public order and good customs, the relevant civil legal actions shall be invalid, and any resulting losses shall be borne by them. If there are suspicions of disrupting financial order and jeopardizing financial security, the relevant departments shall deal with them according to the law.
This notice shall enter into force upon the date of its issuance. The People's Bank of China and ten other departments' "Notice on Further Preventing and Dealing with the Risks of Virtual Currency Trading Speculation" (Yinfa [2021] No. 237) is hereby repealed.
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Foreword: Today, the People's Bank of China's website published the "Notice of the People's Bank of China, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration for Market Regulation, China Banking and Insurance Regulatory Commission, China Securities Regulatory Commission, State Administration of Foreign Exchange on Further Preventing and Dealing with Risks Related to Virtual Currency and Others (Yinfa [2026] No. 42)", the latest regulatory requirements from the eight departments including the central bank, which are basically consistent with the regulatory requirements of recent years. The main focus of the regulation is on speculative activities such as virtual currency trading, exchanges, ICOs, overseas platform services, and this time, regulatory oversight of RWA has been added, explicitly prohibiting RWA tokenization, stablecoins (especially those pegged to the RMB). The following is the full text:
To the people's governments of all provinces, autonomous regions, and municipalities directly under the Central Government, the Xinjiang Production and Construction Corps:
Recently, there have been speculative activities related to virtual currency and Real-World Assets (RWA) tokenization, disrupting the economic and financial order and jeopardizing the property security of the people. In order to further prevent and address the risks related to virtual currency and Real-World Assets tokenization, effectively safeguard national security and social stability, in accordance with the "Law of the People's Republic of China on the People's Bank of China," "Law of the People's Republic of China on Commercial Banks," "Securities Law of the People's Republic of China," "Law of the People's Republic of China on Securities Investment Funds," "Law of the People's Republic of China on Futures and Derivatives," "Cybersecurity Law of the People's Republic of China," "Regulations of the People's Republic of China on the Administration of Renminbi," "Regulations on Prevention and Disposal of Illegal Fundraising," "Regulations of the People's Republic of China on Foreign Exchange Administration," "Telecommunications Regulations of the People's Republic of China," and other provisions, after reaching consensus with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, and with the approval of the State Council, the relevant matters are notified as follows:
(I) Virtual currency does not possess the legal status equivalent to fiat currency. Virtual currencies such as Bitcoin, Ether, Tether, etc., have the main characteristics of being issued by non-monetary authorities, using encryption technology and distributed ledger or similar technology, existing in digital form, etc. They do not have legal tender status, should not and cannot be circulated and used as currency in the market.
The business activities related to virtual currency are classified as illegal financial activities. The exchange of fiat currency and virtual currency within the territory, exchange of virtual currencies, acting as a central counterparty in buying and selling virtual currencies, providing information intermediary and pricing services for virtual currency transactions, token issuance financing, and trading of virtual currency-related financial products, etc., fall under illegal financial activities, such as suspected illegal issuance of token vouchers, unauthorized public issuance of securities, illegal operation of securities and futures business, illegal fundraising, etc., are strictly prohibited across the board and resolutely banned in accordance with the law. Overseas entities and individuals are not allowed to provide virtual currency-related services to domestic entities in any form.
A stablecoin pegged to a fiat currency indirectly fulfills some functions of the fiat currency in circulation. Without the consent of relevant authorities in accordance with the law and regulations, any domestic or foreign entity or individual is not allowed to issue a RMB-pegged stablecoin overseas.
（II）Tokenization of Real-World Assets refers to the use of encryption technology and distributed ledger or similar technologies to transform ownership rights, income rights, etc., of assets into tokens (tokens) or other interests or bond certificates with token (token) characteristics, and carry out issuance and trading activities.
Engaging in the tokenization of real-world assets domestically, as well as providing related intermediary, information technology services, etc., which are suspected of illegal issuance of token vouchers, unauthorized public offering of securities, illegal operation of securities and futures business, illegal fundraising, and other illegal financial activities, shall be prohibited; except for relevant business activities carried out with the approval of the competent authorities in accordance with the law and regulations and relying on specific financial infrastructures. Overseas entities and individuals are not allowed to illegally provide services related to the tokenization of real-world assets to domestic entities in any form.
(III) Inter-agency Coordination. The People's Bank of China, together with 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 China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of virtual currency-related illegal financial activities.
The China Securities Regulatory Commission, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of illegal financial activities related to the tokenization of real-world assets.
(IV) Strengthening Local Implementation. The people's governments at the provincial level are overall responsible for the prevention and disposal of risks related to virtual currencies and the tokenization of real-world assets in their respective administrative regions. The specific leading department is the local financial regulatory department, with participation from branches and dispatched institutions of the State Council's financial regulatory department, telecommunications regulators, public security, market supervision, and other departments, in coordination with cyberspace departments, courts, and procuratorates, to improve the normalization of the work mechanism, effectively connect with the relevant work mechanisms of central departments, form a cooperative and coordinated working pattern between central and local governments, effectively prevent and properly handle risks related to virtual currencies and the tokenization of real-world assets, and maintain economic and financial order and social stability.
(5) Enhanced Risk Monitoring. The People's Bank of China, China Securities Regulatory Commission, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration of Foreign Exchange, Cyberspace Administration of China, and other departments continue to improve monitoring techniques and system support, enhance cross-departmental data analysis and sharing, establish sound information sharing and cross-validation mechanisms, promptly grasp the risk situation of activities related to virtual currency and real-world asset tokenization. Local governments at all levels give full play to the role of local monitoring and early warning mechanisms. Local financial regulatory authorities, together with branches and agencies of the State Council's financial regulatory authorities, as well as departments of cyberspace and public security, ensure effective connection between online monitoring, offline investigation, and fund tracking, efficiently and accurately identify activities related to virtual currency and real-world asset tokenization, promptly share risk information, improve early warning information dissemination, verification, and rapid response mechanisms.
(6) Strengthened Oversight of Financial Institutions, Intermediaries, and Technology Service Providers. Financial institutions (including non-bank payment institutions) are prohibited from providing account opening, fund transfer, and clearing services for virtual currency-related business activities, issuing and selling financial products related to virtual currency, including virtual currency and related financial products in the scope of collateral, conducting insurance business related to virtual currency, or including virtual currency in the scope of insurance liability. Financial institutions (including non-bank payment institutions) are prohibited from providing custody, clearing, and settlement services for unauthorized real-world asset tokenization-related business and related financial products. Relevant intermediary institutions and information technology service providers are prohibited from providing intermediary, technical, or other services for unauthorized real-world asset tokenization-related businesses and related financial products.
(7) Enhanced Management of Internet Information Content and Access. Internet enterprises are prohibited from providing online business venues, commercial displays, marketing, advertising, or paid traffic diversion services for virtual currency and real-world asset tokenization-related business activities. Upon discovering clues of illegal activities, they should promptly report to relevant departments and provide technical support and assistance for related investigations and inquiries. Based on the clues transferred by the financial regulatory authorities, the cyberspace administration, telecommunications authorities, and public security departments should promptly close and deal with websites, mobile applications (including mini-programs), and public accounts engaged in virtual currency and real-world asset tokenization-related business activities in accordance with the law.
(8) Strengthened Entity Registration and Advertisement Management. Market supervision departments strengthen entity registration and management, and enterprise and individual business registrations must not contain terms such as "virtual currency," "virtual asset," "cryptocurrency," "crypto asset," "stablecoin," "real-world asset tokenization," or "RWA" in their names or business scopes. Market supervision departments, together with financial regulatory authorities, legally enhance the supervision of advertisements related to virtual currency and real-world asset tokenization, promptly investigating and handling relevant illegal advertisements.
（IX） Continued Rectification of Virtual Currency Mining Activities. The National Development and Reform Commission, together with relevant departments, strictly controls virtual currency mining activities, continuously promotes the rectification of virtual currency mining activities. The people's governments of various provinces take overall responsibility for the rectification of "mining" within their respective administrative regions. In accordance with the requirements of the National Development and Reform Commission and other departments in the "Notice on the Rectification of Virtual Currency Mining Activities" (NDRC Energy-saving Building [2021] No. 1283) and the provisions of the "Guidance Catalog for Industrial Structure Adjustment (2024 Edition)," a comprehensive review, investigation, and closure of existing virtual currency mining projects are conducted, new mining projects are strictly prohibited, and mining machine production enterprises are strictly prohibited from providing mining machine sales and other services within the country.
（X） Severe Crackdown on Related Illegal Financial Activities. Upon discovering clues to illegal financial activities related to virtual currency and the tokenization of real-world assets, local financial regulatory authorities, branches of the State Council's financial regulatory authorities, and other relevant departments promptly investigate, determine, and properly handle the issues in accordance with the law, and seriously hold the relevant entities and individuals legally responsible. Those suspected of crimes are transferred to the judicial authorities for processing according to the law.
（XI） Severe Crackdown on Related Illegal and Criminal Activities. The Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, as well as judicial and procuratorial organs, in accordance with their respective responsibilities, rigorously crack down on illegal and criminal activities related to virtual currency, the tokenization of real-world assets, such as fraud, money laundering, illegal business operations, pyramid schemes, illegal fundraising, and other illegal and criminal activities carried out under the guise of virtual currency, the tokenization of real-world assets, etc.
（XII） Strengthen Industry Self-discipline. Relevant industry associations should enhance membership management and policy advocacy, based on their own responsibilities, advocate and urge member units to resist illegal financial activities related to virtual currency and the tokenization of real-world assets. Member units that violate regulatory policies and industry self-discipline rules are to be disciplined in accordance with relevant self-regulatory management regulations. By leveraging various industry infrastructure, conduct risk monitoring related to virtual currency, the tokenization of real-world assets, and promptly transfer issue clues to relevant departments.
（XIII） Without the approval of relevant departments in accordance with the law and regulations, domestic entities and foreign entities controlled by them may not issue virtual currency overseas.
（XIV） Domestic entities engaging directly or indirectly in overseas external debt-based tokenization of real-world assets, or conducting asset securitization activities abroad based on domestic ownership rights, income rights, etc. (hereinafter referred to as domestic equity), should be strictly regulated in accordance with the principles of "same business, same risk, same rules." The National Development and Reform Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other relevant departments regulate it according to their respective responsibilities. For other forms of overseas real-world asset tokenization activities based on domestic equity by domestic entities, the China Securities Regulatory Commission, together with relevant departments, supervise according to their division of responsibilities. Without the consent and filing of relevant departments, no unit or individual may engage in the above-mentioned business.
(15) Overseas subsidiaries and branches of domestic financial institutions providing Real World Asset Tokenization-related services overseas shall do so legally and prudently. They shall have professional personnel and systems in place to effectively mitigate business risks, strictly implement customer onboarding, suitability management, anti-money laundering requirements, and incorporate them into the domestic financial institutions' compliance and risk management system. Intermediaries and information technology service providers offering Real World Asset Tokenization services abroad based on domestic equity or conducting Real World Asset Tokenization business in the form of overseas debt for domestic entities directly or indirectly venturing abroad must strictly comply with relevant laws and regulations. They should establish and improve relevant compliance and internal control systems in accordance with relevant normative requirements, strengthen business and risk control, and report the business developments to the relevant regulatory authorities for approval or filing.
(16) Strengthen organizational leadership and overall coordination. All departments and regions should attach great importance to the prevention of risks related to virtual currencies and Real World Asset Tokenization, strengthen organizational leadership, clarify work responsibilities, form a long-term effective working mechanism with centralized coordination, local implementation, and shared responsibilities, maintain high pressure, dynamically monitor risks, effectively prevent and mitigate risks in an orderly and efficient manner, legally protect the property security of the people, and make every effort to maintain economic and financial order and social stability.
(17) Widely carry out publicity and education. All departments, regions, and industry associations should make full use of various media and other communication channels to disseminate information through legal and policy interpretation, analysis of typical cases, and education on investment risks, etc. They should promote the illegality and harm of virtual currencies and Real World Asset Tokenization-related businesses and their manifestations, fully alert to potential risks and hidden dangers, and enhance public awareness and identification capabilities for risk prevention.
(18) Engaging in illegal financial activities related to virtual currencies and Real World Asset Tokenization in violation of this notice, as well as providing services for virtual currencies and Real World Asset Tokenization-related businesses, shall be punished in accordance with relevant regulations. If it constitutes a crime, criminal liability shall be pursued according to the law. For domestic entities and individuals who knowingly or should have known that overseas entities illegally provided virtual currency or Real World Asset Tokenization-related services to domestic entities and still assisted them, relevant responsibilities shall be pursued according to the law. If it constitutes a crime, criminal liability shall be pursued according to the law.
(19) If any unit or individual invests in virtual currencies, Real World Asset Tokens, and related financial products against public order and good customs, the relevant civil legal actions shall be invalid, and any resulting losses shall be borne by them. If there are suspicions of disrupting financial order and jeopardizing financial security, the relevant departments shall deal with them according to the law.
This notice shall enter into force upon the date of its issuance. The People's Bank of China and ten other departments' "Notice on Further Preventing and Dealing with the Risks of Virtual Currency Trading Speculation" (Yinfa [2021] No. 237) is hereby repealed.
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