Digital currency crackdown

People’s Bank of China ramps up digital currency crackdown

Authorities from the People’s Bank of China (PBoC) recently issued a notice warning local institutions not to provide digital currency-related companies’ services.

The Chinese government’s anti-cryptocurrency stance has dominated the news these past few weeks. This latest reinforced rhetoric only increases the urgency for local companies to look elsewhere to set up operations.

The notice included a disclosure that officials forced a Beijing-based software firm to shut down operations over its suspected involvement in providing software services for virtual currency transactions. The central bank deemed the punitive measure necessary to “prevent and control the risk of speculation in virtual currency transactions, and protect the safety of the public’s assets.”

“Here, we solemnly warn relevant institutions within our jurisdiction not to provide business premises, commercial display, marketing, and paid diversion services for virtual currency-related business activities. Financial institutions and payment institutions within the jurisdiction shall not directly or indirectly provide virtual currency-related services to customers,” the statement declares.

The warming further reminds Chinese citizens that they should exercise caution and “enhance their risk awareness” when considering investment opportunities. It warns them against engaging in speculative digital currencies trading and advises them to be wary of its damaging effects. It compels netizens to report clues related to violations of laws and regulations related to digital currency transactions and those suspected of violating the law.

“Personal bank accounts should be cherished and not used for virtual currency account recharge and withdrawal, purchase and sale-related transaction recharge codes, and transfer of relevant transaction funds, etc., to prevent illegal use and personal information leakage,” the Beijing office of the People’s Bank of China further warns.

The move comes amidst China’s intensified crackdown against block reward miners as authorities continue to close mining facilities in several districts that supply more than half of the world’s digital BTC tokens. Officials also blocked the social media accounts of some prominent BTC evangelists.

“China’s government is doing everything they can to ensure that bitcoin (BTC) and other cryptocurrencies disappear from the Chinese financial systems and economy,” said Fred Thiel, CEO of Marathon Digital Holdings in a report to media outlet CNBC. 

Although the crackdown has triggered a massive drop in BTC value, the digital currency remains an attractive Ponzi asset for many looking to make a pump and dump profit off of new entrants coming into the sector.

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