The Chinese government has opted for a “comprehensive ban” on all platforms designed to allow individuals to buy or sell cryptocurrencies in China. Once the world capital of Bitcoin trading, China is severely limiting the potential usage of this coin. The authorities are also looking to shut down Bitcoin exchanges for good, which would be a deadly blow to all the investors.
China still allows individuals to mine and own Bitcoin, but there’s not much you can do with it now.
On Friday, September 15th, Beijing exchanges were instructed to “unwind their operations and provide information on bank accounts used for clients’ deposits by Wednesday.” According to reports, Chinese officials already informed industry executives about the decision. Sources indicate that the country’s Great Firewall will also prevent mainland access to foreign Bitcoin exchanges like Coinbase in the US.
Until that point, Chinese traders believed that the government would still allow over-the-counter or peer-to-peer platforms that allow sellers and buyers to connect. They didn’t think that “cracking down” on commercial activity would affect this area as well.
So, why did it happen? Well, the Chinese authorities were probably concerned that Bitcoin’s popularity would get out of hand and prove too difficult to control or roll back if needed. They were perhaps also concerned that cryptocurrencies might weaken their control over the country’s money supply. The foundation for these concerns most likely lies in the fact that domestic investors started buying heavily into Bitcoin, betting even against the Yuan.
Bottom line, Chinese authorities have definitely made up their mind to crack down on cryptocurrencies and the accompanying industry. Their first step was banning ICOs as a means of collecting funds for projects, followed by this directive, which is almost certainly supposed to extinguish cryptocurrency trading on the domestic market.
We’ll follow the events as they develop and keep you up-to-date with the latest news concerning China’s crusade against virtual currencies.