In short: no. Since September 2021, virtual-currency-related business activities in China have been classified as illegal financial activities, so while quietly holding Bitcoin is not itself a crime, trading it gets no legal protection and can quickly turn into a criminal matter.
What does the law actually say?
On 15 September 2021, ten departments led by the People’s Bank of China issued a joint notice declaring that all virtual-currency-related business activities — running an exchange, providing price quotes or trade matching, token issuance, and payment or settlement services — are illegal financial activities. Overseas platforms serving Chinese users are treated the same way. There is no single article saying that buying Bitcoin is banned; instead, the prohibition targets the business layer.
Where the criminal risk sits
Chinese courts treat virtual-currency trades as falling outside legal protection — if you are cheated, or the platform collapses, you generally bear the loss yourself. The criminal exposure comes from the surrounding conduct. Article 225 of the Criminal Law (illegal business operations) can apply to people who run illegal payment settlement or large-scale currency trading as a business. Article 312 (concealing criminal proceeds) catches over-the-counter traders who accept money that turns out to come from fraud or gambling. Article 287-2 (aiding information-network crimes) covers those who knowingly provide payment or settlement help to online crime, and Article 191 covers money laundering.
What this means in practice
The realistic risk for ordinary users is “card freezing”: if scam money flows into your bank account through a USDT sale, police may freeze the account and you then have to prove you were not part of the fraud. Running even a small over-the-counter desk is where the line between user and suspect is crossed.
An illustrative scenario
A trader sells USDT for a buyer and receives RMB by bank transfer. Weeks later the transfer is traced to a scam and his card is frozen — a common and entirely hypothetical-but-typical situation under China’s “cut the cards” crackdown.
The takeaway: in China crypto is not banned to hold, but it is not protected either — and the moment it becomes a business or touches dirty money, the criminal risk is real. If you trade at any scale, get advice before the freeze, not after.
Related Reading
- Guides: China Criminal Law Guides
- Can You Appeal a Criminal Conviction in China?
- Must Registered Capital Be Paid In Within 5 Years in China?
Wang Guan | Co-founder, Beijing Haolue Law Firm | +86 17813108512