China Vows ‘Immediate Disposal’ of Crypto Exchanges As Bitcoin Plummets

China Vows ‘Immediate Disposal’ of Crypto Exchanges As Bitcoin Plummets

  • China continues its crackdown on crypto exchanges.
  • Binance and Bithumb raid rumors cause widespread FUD.
  • Will China’s U-turn on crypto impact the market?

The Peoples Bank of China (PBOC) has reiterated its position on crypto trading, vowing the immediate disposal of cryptocurrency exchanges.

For weeks China’s strict attitude towards cryptocurrencies has seemingly morphed into something less stringent. Blockchain technology has been championed within the country, and a lighter touch was implemented in regards to bitcoin mining.

This inconceivable 360 on crypto –  which has been responsible for a considerable increase in overall sentiment – has come full circle. In a classic case of blockchain, not bitcoin, China is now looking to reinstill its uncompromising stance on cryptocurrency trading.

According to an official notice from the PBOC, the need to address the trading ban cropped up due to the increase in “virtual currency speculation.” The People’s Republic has been entirely on board the blockchain bandwagon of late, which in turn has lead to a perceived increase in trading activity.

The roughly-translated notice reads:

The People’s Bank of China will continue to implement the requirements of the “Announcement” [2017 ban] and continuously monitor the virtual currency business activities within the jurisdiction. Once it is discovered, it will be disposed of immediately, and it will be prevented from happening early.

The notice began with an explainer, that read:

In recent years, speculations related to virtual currency (such as ICO, IFO, IEO, IMO, and STO) have been refurbished and speculative, prices have skyrocketed, and risks have gathered rapidly. Relevant financing entities through the illegal sale, circulation of tokens, raising funds to investors or bitcoin, Ethereum and other virtual currency, which is essentially unauthorised illegal public financing, suspected of illegal sale of tokens, illegal issuance of securities and illegal fund-raising, financial fraud, pyramid schemes and other illegal crimes have seriously disrupted the economic and financial order.

Chinese Police Raids On Binance and Bithumb, FUD, or Reality?

Interestingly this crackdown comes after several confusing reports of a police raid on two Shanghai-based exchange offices of Bithumb and Binance. The most prominent of the two instances involved Binance.

On November 22, reports broke of a police raid on Binance exchange offices in Shanghai. However, this was almost instantly debunked by Binance boss, Changpeng ‘CZ’ Zhao. CZ suggested that the raid rumors were simply a competitive play by rival exchanges spreading “FUD.”

Binance exchange bitcoin China
Binance boss CZ suggests that exchange raid was just FUD | Source: Twitter

A Binance spokesperson speaking to Bloomberg later corroborated this. Adding to the confusion, however, the representative noted that Binance doesn’t even have an office in Shanghai.

A spokesperson for Bithumb similarly revealed that no raid occurred and that their operations within  Shanghai continue “steadily without pause.”

FUD or not, this seems to have had a direct impact on bitcoin’s price. BTC cited losses of 10% on Friday, coinciding with the news of the raids. Now with China’s reinstated crackdown on exchanges, it seems the markets could be in jeopardy once again.

Published at Fri, 22 Nov 2019 12:54:12 +0000

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