China just hit the table all over the place. The country has long struggled against cryptocurrencies, to the point of forcing banks to block crypto transactions and go after miners. But now the People’s Bank of China (PBC) has just gone one step further.
And it is that the PBC has just published a statement in which it states that all cryptocurrency-related transactions are illegal and should be banned. It has also said that virtual currency exchanges with foreign services that provide services in China are illegal.
A very hard blow to cryptocurrencies
As the PBC has stated in a statement published on its website, “virtual currencies with characteristics such as not being issued by a monetary authority, using cryptography, distributed accounts or similar technology, and existing in digital form, such as Bitcoin and Ether , including so-called stablecoins such as TEDA, do not have the same legal status as legal tender and they cannot circulate in the market as currency“.
When viewed in this way, the People’s Bank of China states the following (bold are own):
“The exchange of virtual currency, the trading of virtual currency as a central counterparty, the provision of aggregation services for virtual currency transactions, the issuance and financing of tokens, and the trading of derivatives of virtual currency and other related businesses virtual currency are all illegal financial activities and are strictly prohibited and resolutely prohibited in accordance with the law; overseas virtual currency exchanges serving Chinese residents via the Internet they are also illegal financial activities. The same is true of foreign virtual exchange houses that provide services to residents of China via the Internet. “
To combat activities related to cryptocurrencies, now considered illegal, the People’s Bank of China and other departments they will take a series of measures, including applying “comprehensive measures regarding the shutdown of payment channels, the removal of related websites and mobile applications in accordance with the law.”
The objective, they assure from the PBC, is curb speculation with virtual currency trading, severely combat financial and criminal activities related to virtual currencies and protect people’s property in accordance with the law, as well as fully safeguard the economic and financial order and social security.
The news has not taken long to affect the value of cryptocurrencies, whose charts are currently tinted red. Bitcoin, which at 10:30 today was at $ 44,903, is right now in free fall and its value has plummeted to $ 42,428. The same goes for Ethereum, which was at $ 3,107 and it has now dropped to $ 2,877.
This is the latest move by China, whose crusade against cryptocurrencies doesn’t seem close to ending. China has been behind Bitcoin for some time, claiming the enormous energy consumption involved in mining (about 65% of Bitcoin was mined in China), proposing stricter regulations, persecuting miners and forcing banks to block transactions.