China orders banks to strengthen anti-crypto campaign

In Beijing’s latest move against Bitcoin, the People’s Bank of China warned several of its largest state-owned banks and Jack Ma’s Alipay to “investigate and identify” bank accounts that facilitate cryptocurrency transactions and block all corresponding transactions.

The central bank said on Monday that it has convened other payment platforms such as the Agricultural Bank of China, China Construction Bank and Industrial and Commercial Bank of China, and Alipay to discuss the issue of “providing services for cryptocurrency trading speculation.”

Regulators call on financial conglomerates to identify and block all transfers to accounts held by cryptocurrency exchanges and other offshore intermediaries, and invest in technology to detect any transactions related to “cryptocurrency speculation”.

The order is part of the Chinese government’s recent crackdown on cryptocurrencies in May as Beijing tried to end transactions and shut down the world’s largest cryptocurrency mining business located within its borders. On the contrary, the central bank wants citizens to use their own digital currency and has begun large-scale trials.

Although the Chinese authorities took the first step to prohibit banks from processing bitcoin transactions as early as 2013, and launched several crackdowns since then, they have been unable to completely eliminate cryptocurrency transactions. According to industry insiders, one way that Chinese people can still obtain Bitcoin is through peer-to-peer traders.

Leo Weese, co-founder of the Hong Kong Bitcoin Association, said that in order to implement the directive, authorities and banks can slowly begin to track and cut off the bank accounts used by peer-to-peer traders to accept payments.

“Chinese Bitcoin transactions will continue, but liquidity will decrease and spreads will increase,” Weiss said. “People will restrict themselves from trading with friends and trusted friends of friends.”

The People’s Bank of China stated that trading encrypted currencies disrupts the financial system, breeds illegal cross-border asset transfers and money laundering risks, and “seriously violates the security of people’s financial assets.”

As part of its strict capital control system, China has greatly restricted citizens’ ability to transfer funds out of the country, and has been watching Bitcoin vigilantly since it became popular nearly a decade ago.

According to estimates before the crackdown, since last month, China has increased its efforts to dissolve power-consuming Bitcoin mining in the country, and about 75% of the world’s mining activities take place in this country.

Sichuan is a province rich in hydropower resources in southwestern China Latest province It ordered its 26 largest local mines to cease operations last week. Previously, the local government imposed bans on major cryptocurrency mining locations such as Xinjiang, Yunnan, and Qinghai.

Even the northern part of Inner Mongolia Set up a hotline Let residents whistle to their neighbors who suspect they are cryptocurrency miners.