Chinese government effectively bans cryptocurrencies

(Image credit: Yevhen Vitte / Shutterstock)

A new order from three leading financial organizations in China has directed all banks to prohibit customers from accessing cryptocurrency trading or storage, in essence stopping all cryptocurrency trades in the country.

The Register reports that in addition to banning access to cryptocurrencies, the National Internet Finance Association of China, the China Banking Association, and the Payment and Clearing Association of China, have also asked financial institutions not to provide insurance to cryptocurrency businesses or investments.

The order also warns Chinese citizens about the dangers of cryptocurrency, saying that the virtual currency makes for a poor investment, since it can be easily manipulated. 

Furthermore, it’s reported that web platforms have been asked not to lend hosting space to any crypto companies. It further tightens the noose by outlawing any adverts for any crypto-related business activities, including cryptocurrency mining operations.

Blockchain without crypto

China’s strong opposition for cryptocurrencies comes even as the country plays host to many large Bitcoin mining operations. In fact, some of the world’s fastest cryptocurrency miners are made by Chinese firms such as Linzhi and Bitmain.

The new order reportedly follows from a 2019 People's Bank of China decision that called for blocking access to all cryptocurrency exchanges and initial coin offering services. 

Despite its apparent dislike for all things crypto, CNBC reports that the country hasn’t had an issue with its underlying blockchain technology. 

In fact, in the year its central bank called for a ban, Chinese President Xi Jinping heaped praise on blockchain technology, and called for the country to “seize the opportunities” it presented.

It'll be interesting to see how the country will now innovate with the technology after outlawing one of its biggest use cases.

TechRadar is supported by its audience. TechRadar does not endorse any specific cryptocurrencies or blockchain-based services and readers should not interpret TechRadar content as investment advice. Our reporters hold only small quantities of cryptocurrency (under $100 in value), as is necessary to perform wallet and exchange reviews, and do not hold shares in any publicly listed cryptocurrency companies.

Via The Register

Mayank Sharma

With almost two decades of writing and reporting on Linux, Mayank Sharma would like everyone to think he’s TechRadar Pro’s expert on the topic. Of course, he’s just as interested in other computing topics, particularly cybersecurity, cloud, containers, and coding.