China Flags Ban on Domestic and Overseas Cryptocurrency Trading Platforms

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The central bank’s official news publication reports that China plans to further step up its crackdown on the cryptocurrency market with bans on both domestic and overseas online trading platforms.

Beijing kicked off its crackdown on cryptocurrencies in September last year, when it placed a ban on initial coin offerings as well as any form of financing that made use of virtual monies.

The “Public Notice Concerning the Prevention of Cryptocurrency Issuance Financial Risk” (关于防范代币发行融资风险的公告) issued by the People’s Bank of China prohibited online trading platforms from converting virtual currencies and fiat money, as well as the provision of financial or information intermediation services in relation to virtual currencies.

Regulators now appear intent upon further stepping up their crackdown on the domestic cryptocurrency market, with the central bank’s official news publication reporting that Beijing plans to ban or otherwise dispose of both domestic and foreign online exchanges.

According to Financial News the cryptocurrency crackdown launched last year has failed to achieved its intended effect.

“ICO’s and virtual currency transactions have not withdrawn from China as a result of the crackdown. It’s believed that following the closure of domestic virtual currency exchanges, many domestic parties shifted to overseas online platforms and continued to participate in virtual currency transactions.

“At present Japan and Hong Kong are common places of refuge for trading platforms.

“Overseas trading, avoidance of regulation, virtual currency transactions and ICO’s are all undergoing a revival.

“It is believed that given the various risks faced by domestic investors who shift to overseas platforms to participate in transactions…[authorities] will adopt a series of regulatory measures, including bans on related commercial conduct, and bans on and disposal of both domestic and overseas cryptocurrency trading platforms…in order to prevent financial risk and maintain financial stability.

“Subsequently, authorities will close any [exchanges] that they uncover, and at the same time, depending upon the developing situation, they will not rule out the possibility of introducer stricter regulatory measures”

 

 

 

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