China’s regulators reinforce a crackdown on cryptocurrency, banning overseas exchanges from serving mainland customers. What’s new about China’s latest ban on crypto exchanges?
China’s new ban on crypto breaks out from the past restriction policies. China’s regulators, including People’s Bank of China (PBOC) intensified a crackdown on Friday, banning crypto transactions and mining. Also, it declares all cryptocurrency-related businesses illegal.
For the first time, the PBOC calls out Bitcoin (BTC), Ether (ETH), and Tether (USDT) – the largest stablecoin by market cap – by name. People should not use stablecoins, according to the statement. It shows that China’s regulators are looking at the potential risk of stablecoins.
Moreover, the new ban expands to prohibiting all crypto-related activities, including order matching, token issuance, and crypto conversion. This increases the risk for domestic staff of overseas crypto exchanges in China.
“For domestic staff of relevant overseas crypto exchanges, as well as those who know or should know that they are engaged in crypto-related business, they are still illegal financial activities,” according to the statement.
Huobi, Binance Exchanges to Close Chinese Accounts
Chinese investors now account for roughly 10 percent of the world’s Bitcoin buyers, according to China’s state media Global Times. Amid the latest ban, Global Times expects more than 90 percent of China’s Bitcoin mining capacity will be shut down.
“China’s opposition to cryptocurrencies is nothing new. But the latest clarification would suggest those involved are at risk of prosecution,” Craig Erlam, senior markets analyst, Oanda says.
Following China’s new ban on crypto trading, China’s leading crypto exchange Huobi stops taking new mainland customers, effective September 24. And, Houbi would end serving mainland customers by the end of the year. Moreover, Huobi will conduct an orderly exit of its existing customers in China.
Other leading exchanges, such as Binance, are likely to conduct similar action, in order to comply with the regulation. In general, Binance, Houbi, and OKEx are the big three crypto exchanges serving mainland China customers.
Binance has stopped letting traders use mainland China mobile numbers to register new accounts. New sign-ups are still available for Hong Kong users on Binance. But mainland China is no longer an option for new-account creation.
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