China's virtual power plant (VPP) development started late, lacking mature market mechanisms and optimization strategies. This analysis explores VPPs’ market participation path in China. Firstly, the current electricity market trading mechanisms in China are analyzed, including demand response, peak shaving and frequency regulation ancillary services, and medium-to-long-term and spot energy trading. It explores how VPPs can effectively integrate into these mechanisms and analyzes their participation in various market mechanisms. Then, a review was conducted on the optimization strategies of VPPs participating in market transactions, covering aspects such as resource combination, operation scheduling, market bidding, and uncertainty handling, along with universally applicable mathematical expressions for optimization models are established. Finally, the development trend of VPPs participating in market transactions in China is discussed, and the urgent problems and future development directions in the research of optimization strategies for VPPs are pointed out.