China’s authorities have resumed their all-out war against cryptocurrency businesses with a new campaign aimed at shutting down all remaining crypto-related activities.
Eleven cryptocurrency companies and a prominent financial website were ordered to shut down by the Shenzhen branch of the People’s Bank of China amid an intensified nationwide crackdown against the digital assets business.
Per a Global Times report, the central bank plans to “promptly clean up and rectify” these platforms for providing illicit crypto trading activities. The state-owned media outlet calls these measures “rectification,” a term used to describe that authorities are bringing crypto operators in line with local regulation. The same term has been used before, namely in 2020 when China authorities cracked down on financial giant Ant Group.
The notice also mentioned 46 firms that had been inspected and reported as potential cryptocurrency enterprises.
The latest enforcement action underscores Chinese regulators’ determination to curb crypto trading to control financial risks, despite certain benefits to local economies.
The official statement further reads:
“Carry out special rectification of illegal virtual currency trading activities, and promptly clean up and rectify 11 newly emerging companies suspected of carrying out illegal virtual currency activities. Completed the rectification of a well-known domestic financial website that was suspected of propagating violations of foreign exchange deposit trading, and properly handled 8 reports of illegal and criminal activities related to online foreign exchange and cross-border stock trading.”
Authorities also moved against a “well-known domestic financial website” providing FX trading, and investigating eight reports involving online forex and stock trading services.
In addition to the crackdown, the PBoC branch has launched educational programs to help consumers avoid the most pressing and worrying issues, with a strong focus on those falling foul of financial regulations.
The local officials will be also tasked with ceasing operations of any identified cryptocurrency exchanges, along with any fundraising business or token sales, which is a criminal offense in China.
The move shows a centralized effort from Beijing to completely eradicate unregulated crypto business on the mainland. The government plans to close the few remaining loopholes in order to entirely restrict its citizens from transacting cryptocurrencies or participating in trades held abroad.
Beijing’s tougher stance will also target overseas platforms that offer exchange-like services to mainlanders and allow them to trade the digital assets. The current rules already scrutinize Chinese banks, online-payment providers, and individuals suspected of facilitating trades on offshore cryptocurrency venues.