Last week, the People’s Bank of China resounded its stance on cryptocurrencies declaring every operation/transaction related to cryptocurrency illegal and banned within the shores of the country. Following the Friday declaration on cryptocurrencies, exchange platforms have begun to ban Chinese users from accessing their platforms. The ban did not exclude exchange platforms based in other countries; they are also to stop providing cryptocurrency-related services to users in China.
Binance, one of the biggest exchange platforms in the world, has blocked Chinese users from accessing its platform. According to the exchange, account registrations using Chinese mobile phone numbers have been blocked and the Binance app has been taken down from stores in China. A Binance spokesperson said that “Binance takes its compliance obligations very seriously and is committed to following local regulator’s requirements wherever we operate”.
China’s animosity towards cryptocurrency isn’t new. Back in 2017, the country closed down local cryptocurrency exchanges. It also went as far as banning what was termed initial coin offering (ICOs), a proposed IPO for cryptocurrency which will help cryptocurrency companies raise funds by issuing their digital currencies. The country’s fear has always been centred around how allowing cryptocurrency to thrive would be detrimental to its financial stability. Other minor concerns include the mining processes of these cryptocurrencies takes a toll on the country’s resources.
The crackdown actions have usually been targeted towards mining and trading operations but these new rounds are targeted towards cryptocurrency companies still providing cryptocurrency services to Chinese users.
The crackdown action against miners, which was at its peak months ago, pushed miners out of the country. Many of them had to move their operations to other favourable countries. During this dreaded period, more than $300 billion worth of cryptocurrencies was lost.
Apart from Binance, Huobi, another globally recognized exchange platform announced on Sunday that it had stopped registering new accounts for mainland Chinese users. It also mentioned that it will eventually stop the accounts of already existing users from being active on the 31st of December, 2021.
With the new crackdown actions, China aims to close the existing loopholes that have enabled Chinese citizens to hold, store and trade cryptocurrencies.
Ibhadojemu Lucky Emmanuel is a graduate of Education and Economics from the University of Benin. He has a passion for tech and business and has been writing professionally for over a period of five years. He's written across various topics and segments and knew tech-business was it when he first stumbled on it. He has a great passion for music and arts, and wants to visit as many countries as he can someday.
To provide the best experiences, we use technologies like cookies to store and/or access device information. Consenting to these technologies will allow us to process data such as browsing behaviour or unique IDs on this site. Not consenting or withdrawing consent, may adversely affect certain features and functions.
Functional
Always active
The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
Preferences
The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
Statistics
The technical storage or access that is used exclusively for statistical purposes.The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
Marketing
The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
