News China Is Serious About Cracking Down on Cryptocurrency

China Is Serious About Cracking Down on Cryptocurrency


- Advertisment -

CRYPTO CRACKDOWN. More than 120 offshore cryptocurrency exchanges have been blocked by Chinese authorities, the South China Morning Post reports. The exact reasoning is not entirely clear — the central bank didn’t respond to calls from SCMP reporters — though some speculate that the crackdown is a response to increasing financial risk and instability.

The government will continue to monitor for any new crypto news sites and announcements of Initial Coin Offerings (ICOs). If any appear, the government will shut them down immediately and deny user access by blocking their IP addresses.

The move comes after local authorities in Beijing banned some hotels from hosting any events that had anything to do with cryptocurrencies, and blocking blockchain news accounts on WeChat (the biggest social media company in the country) last week. SCMP reports that at least eight crypto media outlets on WeChat were affected.

CRYPTO WHACK-A-MOLE. China’s antipathy for all things crypto isn’t a surprise. In September 2017, Chinese authorities banned all new ICOs and existing cryptocurrency exchanges in the country. As far as Chinese regulators are concerned, ICOs are nothing but “unauthorized illegal fundraising activities.” And to a certain extent, their worries are justified — many ICOs in China have been found to be complete scams, robbing the Chinese people of their hard-earned cash with dubious claims and promises of wealth.

But the government’s attempt to get rid of crypto doesn’t seem to have been very successful. While news of the 2017 ban initially caused the international cryptocurrency market to nosedive, Forbes reports that local Chinese cryptocurrency markets recovered just weeks later.

SAFETY ON THE BLOCKCHAIN. Whatever reservations the Chinese government seems to have about cryptocurrency, it doesn’t apply to the blockchain itself. In 2017, China’s central bank opened its own Digital Currency Research Institute near Beijing’s financial district, suggesting that a national state-backed digital currency (read: backed with reserves of fiat currency) on the blockchain might be right around the corner.

And China’s IT Ministry opened a research facility called the Trusted Blockchain Open Lab just days after it announced the ban on bitcoin trading, as Coindesk reports.

In fact, the central bank already developed a prototype national cryptocurrency last year, but an exact timetable is still unknown.

So while banning all things crypto might ostensibly keep the financial system more secure, it might also clear the field for China to release its own cryptocurrency.

And as the relationship between the U.S. and China has frayed, a strong digital currency could give China an opportunity to put an end to the U.S. dollar’s dominance. Banning the competition is one way to get there.

READ MORE: China to block more than 120 offshore cryptocurrency exchanges as crackdown escalates [South China Morning Post]

More on China and cryptocurrencies: China Becomes First Country in the World to Test a National Cryptocurrency



Please enter your comment!
Please enter your name here

Latest news

Polkadex Enhances the Cryptocurrency Trading Experience

The global economy has not entered the modern era as of yet. Luckily, there are tools to...

Ethereum Price Sees $500 for the First Time in Two-and-a-half Years

First launched in 2014, Ethereum or Ether is one of the oldest altcoins and probably the most...

Banking Sector is Ready for a Tech Revolution With Cryptocurrency

When our world is going through a massive change due to COVID-19blow, it is very likely that...

OpenDAO’s Bridge Opens New Possibility for Mass Adoption of DeFi

When Satoshi Nakamoto officially created Bitcoin on January 3, 2009, his vision for the digital asset was...
- Advertisement -

Crypto’s price surge was mostly due to limited information – here’s why

As the world becomes more and more digitized, the usage of one of the most popular cryptocurrencies,...

U.S. Authorities Seized Bitcoin Worth a Total of $1 billion

The cryptocurrencies were in the possession of a person who had hacked Silk road, which was detected...

Must read

Polkadex Enhances the Cryptocurrency Trading Experience

The global economy has not entered the...

Ethereum Price Sees $500 for the First Time in Two-and-a-half Years

First launched in 2014, Ethereum or Ether...
- Advertisement -

Read Next
Recommended to you