Many social media accounts are igniting a buzz suggesting that China has imposed a fresh ban on cryptocurrencies to support its own digital yuan stablecoin.

Countering these rumors, Su Zhu, founder of the now-defunct cryptocurrency hedge fund Three Arrows Capital, has said that there is "zero evidence" from his Chinese source about any fresh cryptocurrency ban imposed by the government.

Pseudonymous Chinese cryptocurrency blogger Colin Wu has also stated that there is no evidence of new restrictions.

Despite the official statement of denying crypto ban in China, the rumors have influenced the market, pushing Bitcoin down overnight below $113,000.

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However, with the news about the China crypto ban being widely dismissed as fake news, the crypto market is already beginning to bounce back. Bitcoin bounced from $112,200 to $113,700, quickly reclaiming $113k after dropping below once the China news began circulating late yesterday.

It is pertinent to note that the People’s Bank of China (PBoC) first restricted local financial institutions from processing Bitcoin transactions in late 2013.

In September 2017, China launched a major cryptocurrency crackdown, implementing a complete ban on initial coin offerings (ICOs) and prohibiting domestic cryptocurrency exchanges, which were then forced to relocate abroad.

Most recently, in 2021, China targeted its booming crypto mining sector, imposing strict measures to shut down mining operations across the country.