The People's Bank of China has officially classified stablecoins as virtual currency, highlighting regulatory risks associated with their use. In a recent article, the bank emphasized that stablecoins do not currently meet necessary standards for customer identification and anti-money laundering, posing potential threats such as money laundering and illicit cross-border fund transfers. This marks the first formal definition of stablecoins in Chinese regulatory documents, categorizing them under 'illegal financial activities involving virtual currency.' While this move is not expected to directly affect Hong Kong's stablecoin market, it may prompt more cautious engagement from mainland institutions.