The ruling contradicts that of a court in Shanghai last week.
Another 94 banks plan to access the CBDC via a clearing platform.
China's central bank vowed earlier in August to keep high pressure on crypto trading.
The PBoC has been pushing for hardware applications of the digital yuan.
China's central bank holds that crypto trading brings financial risk to the economy, and said it will continue a crackdown on the industry.
The PBOC also said the central bank digital currency will be compatible with smart contracts.
Global stablecoins "may bring risks and challenges to the international monetary system," said PBOC's Fan Yifei.
Bitcoin fell from $35,100 to nearly $34,000 after the news started doing the rounds on Twitter.
Miners leaving China show the seriousness of new enforcement. But constrained trading and investment are more likely to really matter.
China's central bank says institutions must not provide trading, clearing and settlement for crypto transactions.
Central bank digital currencies will one day be more "smart," and not merely digital versions of cash, Yao Qian said.
China’s reiterated crypto ban sharpens the focus on the financial sector.
The Alibaba-affiliated company disclosed the information over the weekend at the Digital China Summit in Fuzhou.
The deputy governor said bitcoin and stablecoins were investment options and not currency during the Boao Forum on Sunday.
“The dollar’s status as the key global currency won’t change so easily,” BOJ’s head of payments told Bloomberg.