- China’s liquidation plan links with Hong Kong exchanges.
- Crypto markets react sharply to China’s strategy.
- Mainland aims to bolster central control over digital assets.
China’s authorities, led by Beijing’s Public Security Bureau, announced plans to liquidate confiscated crypto assets via Hong Kong exchanges, aligning on June 2025 with their regulatory efforts.
This significant shift aims to reinforce control over unregulated crypto activity, impacting market prices noticeably and highlighting Hong Kong’s growing role in regulated virtual asset transactions.
China’s crypto liquidation plans involve coordinated efforts with regulated Hong Kong entities. Mainland authorities work to dispose of confiscated digital assets, aligning with China’s broader strategy to eliminate unregulated crypto activity and strengthen central control.
Key players in this plan include Beijing’s Public Security Bureau and the China Beijing Equity Exchange (CBEX). They announced a “Framework Agreement” in June 2025, appointing third-party agents to sell seized crypto on licensed Hong Kong exchanges.
The market saw immediate effects post-announcement, with Bitcoin dropping significantly. Other major cryptocurrencies, including Ethereum, XRP, and Dogecoin, also suffered substantial losses exceeding 12%. This plan marks a major realignment of digital asset management.
Financial implications include a sharp drop in market capitalization and increased trading volume on Hong Kong exchanges. This supports China’s strategic goal of enhancing financial stability and curbing the rise of private tokens competing with the Digital Yuan.
The absence of public commentary from major crypto leaders, like CZ and Vitalik Buterin, reflects the sensitive geopolitical implications of China’s actions. No direct responses were noted on platforms such as Twitter or LinkedIn.
Past trends indicate that crypto market volatility can follow such actions. Lesson from historical precedents urges caution, as liquidation events have historically shifted asset liquidity from less regulated venues to more legally compliant territories like Hong Kong.
Official Statement, Beijing Public Security Bureau: “Under the ‘Framework Agreement on Handling Seized Virtual Currencies’, CBEX will be responsible for appointing third-party agencies to sell the assets through the exchanges. Proceeds will be converted into yuan and deposited in designated accounts.” source
