China is doubling its efforts to shutdown cryptocurrency. Plans are underway to remove any residual trading, says state media.
According to the state-run Securities Journal, the country is intent to clean over-the-counter trading platforms as well as peer-to-peer networks – a place where large tradings occur. The source of information has been anonymously cited as close to regulators involved in dealing with online finance risks.
Last year, China similarly conducted a cryptocurrency crackdown where bitcoin exchanges in Beijing were shutdown. Initial coin offerings were similarly banned.
However, alternative venues for cryptocurrency trading emerged. Social networks such as Telegram, QQ, and WeChat have been used by customers.
Online groups that have facilitated peer-to-peer trade in a large scale will likely be investigated in the upcoming months.
Such efforts have caused the value of cryptocurrencies to plunge.
Reports reveal that small peer to peer transactions will not be blocked. But sites and mobile applications that provide cryptocurrency exchange services will be targeted. Authorities will also be on the lookout for market-making settlement as well as centralized trading clearing services.
Despite the government’s concerted efforts to halt cryptocurrency, China is still the biggest cryptocurrency mining source in the world.
However, a few of the effects of China’s crackdown is the quick decline in value of digital currencies such as ethereum, litecoin, and Ripple XRP.
Back in 2017, China banned initial coin offerings or ICOs.
ICOs allowed start-ups to raise the funds they need by selling new cryptocurrencies. However, China shocked the digital currency world when it decided to shutdown exchanges in domestic cryptocurrency.
South Korea also banned cryptocurrency trading – an action that caused digital currencies to fall. Fortunately, Bitcoin was able to recover from the slump as it traded 4.78 percent higher at $14,269.80 a coin via CoinDesk.