Chinese financial news outlet Caixin deleted an article detailing the potential withdrawal of domestic internet companies from crypto-related businesses, signaling heightened regulatory sensitivity and creating uncertainty in the market.

Executive Summary

Chinese financial news outlet Caixin recently deleted an article discussing the potential withdrawal of domestic internet companies from crypto-related businesses. This action has been interpreted as a significant indicator of ongoing regulatory sensitivity within China regarding cryptocurrency activities, contributing to market uncertainty, particularly for entities with exposure to the Chinese market.

The Event in Detail

Caixin, a prominent Chinese financial news outlet, had published an article titled "Domestic internet companies may withdraw from crypto-related businesses." The article's subsequent deletion from Caixin's platform highlights the sensitive nature of discussions surrounding crypto-related businesses and the evolving regulatory stance in China. The original report suggested that mainland Chinese firms operating in Hong Kong might be compelled to cease their cryptocurrency-related activities. Furthermore, it indicated that Hong Kong branches of state-owned enterprises and Chinese banks are anticipated to refrain from pursuing Hong Kong stablecoin licenses, with some reportedly postponing their applications due to recent policy shifts.

Deconstructing Regulatory Mechanics and Business Strategy

China has maintained a comprehensive ban on all cryptocurrency activities, including trading, mining, and individual ownership, with policies enforced by multiple government bodies. This ban, reaffirmed as of mid-2025, aims to centralize financial control, accelerate the adoption of its state-backed digital yuan (CBDC), mitigate financial risks, and reassert financial hegemony. The deletion of the Caixin article underscores a cautious approach among Chinese media and businesses concerning public discourse on crypto, aligning with the government's strict stance. Despite this, Hong Kong continues to develop a parallel legal framework that allows licensed crypto exchanges to operate under specific guidelines. However, even within Hong Kong, the influence of mainland policy appears to be prompting Chinese institutions to reconsider participation in the nascent stablecoin market, with one senior financial industry insider remarking that "Hong Kong's stablecoin business is just beginning, and its future direction is unclear," and advising "not to rush into participation." This indicates a strategic withdrawal or hesitation by Chinese entities to avoid potential conflicts with the mainland's overarching anti-crypto directives, even in a region with a distinct regulatory environment.

Market Implications

The deletion of Caixin's article is likely to increase speculation and uncertainty regarding China's future cryptocurrency regulatory environment. This event signals a potentially continued strict stance from Chinese authorities on crypto activities, which could further drive crypto businesses underground, offshore, or entirely out of the Chinese market. While Chinese state media has consistently warned against cryptocurrency, citing risks such as capital flight and financial instability, a 2023 report indicated that Chinese traders earned approximately $86 billion from crypto transactions despite the bans, suggesting persistent, albeit underground, activity. For the broader Web3 ecosystem, this reinforces the challenge of operating in jurisdictions influenced by China's policy, potentially leading to increased caution among companies with any involvement in the Chinese market. It also highlights the ongoing tension between a stringent national ban and the global, decentralized nature of cryptocurrency markets, influencing broader market sentiment and the strategic decisions of global crypto firms considering their regional exposures.