China’s central bank has notified the country’s financial institutions to stop handling cryptocurrency transactions. The disclosure states that the People’s Bank of China (PBOC) aims to protect Chinese citizens and “combat speculation in Bitcoin and other virtual currency transactions.”
PBOC urges banks to stop dealing with crypto exchanges and OTC desks
- On June 21, 2021, the People’s Bank of China (PBOC) notified a number of financial institutions regarding crypto transactions.
- The PBOC says it has discussed the issue of cryptocurrencies with financial services companies such as the Industrial and Commercial Bank of China, the Agricultural Bank of China, the Construction Bank, the Postal Savings Bank, the Industrial Bank, and the Alipay (China) Network.
- The PBOC stressed that “virtual currency trading activities disrupt normal economic and financial order, pose the risk of illegal cross-border asset transfers, money laundering and other illegal and criminal activities, and seriously harm the security of people’s property”.
- China’s payment institutions and banks must implement strict guidelines on “Bitcoin Risks”, “Token Issue Risks” and other regulatory requirements set out in the PBOC notice.
- Financial institutions “may not offer account opening, registration and registration for related activities,” added the central bank.
- China’s Post Savings Bank followed suit, stating that it would not allow cryptocurrency transactions in any way.
- “According to the relevant regulations of the People’s Bank of China, no institution or individual is allowed to use our bank’s accounts, products, services and channels to conduct token spending financing and transactions with ‘virtual currencies’,” said China’s Postal Savings Bank.
- The Postal Savings Bank also said that if Chinese citizens notice crypto activity or behavior related to virtual currencies, they can report it to our bank.
- The PBOC news follows the June 20 mandate from Sichuan officials banning bitcoin mining in the area. Since the ban in five major Chinese provinces, Bitcoin’s hashrate has dropped to 100 exahash per second (EH / s).
- Also the Chinese journalist Colin ‘Wu’ Blockchain tweeted on Monday’s PBOC announcement, announcing that two other financial institutions have made statements on the matter. “The Agricultural Bank of China has republished the deleted website and Alipay has also issued a corresponding statement,” said the regional reporter.
- Bitcoin’s price (BTC) fell to a low of $ 31,700 per unit on Monday following the PBOC’s announcement. Since then, the crypto asset has managed to jump back over the $ 32K zone.
What do you think of the PBOC’s recent announcement against crypto asset transactions and China’s financial institutions? Let us know what you think on this matter in the comments below.
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