Crypto transactions banned in China

Crypto transactions banned in China

Kanako Mita and Noriko Watanabe

Modern Tokyo Times

The trillion-dollar industry of cryptocurrencies and crypto-related transactions is now deemed illegal in China. Naturally, crypto mining is also deemed illegal because of the obvious connection and issues concerning carbon emissions. Therefore, it will be interesting to see the repercussions for Bitcoin, other cryptocurrencies, and other angles to crypto-related finance in the following weeks.

The People’s Bank of China and the Chinese Communist Party are alarmed by fraud, money laundering, and other negative angles concerning cryptocurrencies and crypto-related transactions. Also, the energy usage concerning crypto mining means that the shift to other nations had already begun. 

Reuters reports, “The People’s Bank of China (PBOC) said cryptocurrencies must not circulate in markets as traditional currencies and that overseas exchanges are barred from providing services to mainland investors via the internet.”

The PBOC said, the government of China will “resolutely clamp down on virtual currency speculation, and related financial activities and misbehavior in order to safeguard people’s properties and maintain economic, financial and social order.”

The PBOC continued by stating that internet platforms, payment companies, and financial institutions will be prohibited from promoting and enabling the trading of cryptocurrencies. 

The latest development is a continuation of events in May after China warned about the damaging effects of cryptocurrencies and crypto-related transactions. Henceforth, internal cryptocurrency sell-offs occurred from May – and further afield.

Forbes reports, “Friday’s directive is the latest action undertaken by Beijing in its ongoing crackdown on trading and mining of cryptocurrencies. These actions have caused wild swings in the values of popular cryptocurrencies which had already witnessed a slump from record highs set earlier this year. In May, China’s State Council ordered a crackdown on crypto mining in the country as the activity consumes massive amounts of energy which Beijing believes will hamper its attempts to cut back on carbon emissions.”

Other nations, including Bangladesh, Egypt, the Russian Federation, and others, are also worried about similar angles. However, the economic clout of China takes this concern to a higher level. 

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