Chinese Government Bans Foreign Cryptocurrency Exchanges, thus provoking a major dip in the cryptocurrency market. The move from China aims to prevent “financial risks,” according to the reports. How will the situation develop and will the market be able to recover from the losses?
6 February, AtoZForex – The Chinese authorities are reportedly moving to block local access to foreign websites that offer services for cryptocurrency trading and ICO investmentsto the locals. Numerous media reports, including the one that is linked to the People’s Bank of China, have signaled that authorities are looking into cracking down on the overseas cryptocurrency trading.
Chinese Government Bans Foreign Cryptocurrency Exchanges
According to the one of the local Chinese reports:
“To prevent financial risks, China will step up measures to remove any onshore or offshore platforms related to virtual currency trading or ICOs.”
Such move appears some months following China officially banning investments in initial coin offerings (ICOs). The authorities claimed that the Blockchain use case to constitute a form of illegal financing. Moreover, officials there have cracked down some of the online websites for crypto trading.
The new domestic reports indicate that Chinese government is now planning to target overseas websites that solicit to the local users. One of the reports states that the actions from Chinese officials are taking place due to the fact that “after the closure of the domestic virtual currency exchanges, many people turned to overseas platforms to continue participating in virtual currency transactions.”
What now for Chinese Digital Currency Market?
Another online media source cited a statement from the central bank of China in regards to the proposed overseas website ban. Reportedly, the statement mentions that authorities intend to “ban all crypto-related commercial business including banning and blocking both domestic and offshore cryptocurrency trading platform websites.”
This local report further adds that the future of the Chinese cryptocurrency market is dependent on the development, as it also does not determine the possibility of unveiling further regulatory means.
In the meantime, many regulators still believe that there is no actual need to ban the cryptocurrencies entirely. Yet, they signal a need to regulate the market in order to prevent misconduct. In such latest news, South Korea has informed the public it does not plan to ban cryptocurrency trading across the country.
Think we missed something? Let us know in the comments section below.