China's Central Bank Shakes Market with Stablecoin Crackdown

Hong Kong stocks with stablecoin ties tumbled Monday after China's central bank reaffirmed its crackdown on virtual currencies, highlighting concerns about stablecoins' lack of customer identification and anti-money laundering controls. Key companies saw significant stock declines, reflecting market unease over regulatory moves.

Hong Kong-listed stocks associated with stablecoins experienced sharp declines on Monday. This followed a statement from China's central bank, the People's Bank of China, which reiterated a commitment to curbing activities associated with virtual currencies.

The central bank's announcement on Saturday underlined concerns surrounding the speculative resurgence and illegal activities linked to stablecoins. Companies such as Yunfeng Financial Group saw a nearly 10% drop, while Bright Smart Securities and Commodities Group fell around 7%, and OSL Group's shares decreased by over 4%.

The PBOC's scrutiny particularly focused on stablecoins, citing failures to comply with customer identification and anti-money-laundering regulations, adding another layer of pressure to the already volatile cryptocurrency market.

(With inputs from agencies.)