China blocking offshore crypto platforms | finder.com

China blocking offshore crypto platforms

Peter Terlato 5 February 2018 NEWS

China is stepping up measures to ban overseas trading platforms, citing risks such as illicit issuance and fraud.

China’s central bank has revealed plans to escalate its ban on cryptocurrency trading and initial coin offerings (ICOs) by prohibiting local access to international digital currency platforms.

The development was first reported on Sunday evening by a publication – Financial News – linked to the People’s Bank of China (PBOC), according to the South China Morning Post.

“To prevent financial risks, China will step up measures to remove any onshore or offshore platforms related to virtual currency trading or ICOs,” an article published by Financial News said.

The article declared that ICOs and virtual currency trading “did not completely withdraw from China”, despite the government’s industrious attempts to implement a nationwide ban on cryptocurrency-related activities.

“After the closure of the domestic virtual currency exchanges, many people turned to overseas platforms to continue participating in virtual currency transactions,” the Financial News said.

“Overseas transactions and regulatory evasion have resumed… risks are still there, fueled by illegal issuance, and even fraud and pyramid selling.”

The clampdown on overseas trading platforms was confirmed by the PBOC, according to Xinhua news agency.

Since these latest reports of intensified restrictions, advertisements for cryptocurrencies have apparently stopped appearing on China’s biggest search engine, Baidu, and popular social media platform Weibo.

China first introduced a ban on cryptocurrency exchanges and ICOs in September 2017. This forced locals to seek out alternative trading arenas, such as international exchanges, to utilize their funds from the mainland.

Despite being home to the largest cryptocurrency mines in the world, China has an unfavorable view of crypto. Virtual currencies aren’t considered legal tender and banks are banned from holding and distributing them.

Earlier in January, the PBOC instructed China’s financial institutions to cease providing cryptocurrency services, including the prevention and suspension of payment channels used for digital currency settlements.
The PBOC said banks should supervise capital settlements to thwart stakeholder complaints and protests.

Similarly, South East Asia’s Bank Indonesia declared that virtual currencies, including bitcoin, were no longer recognized as a legitimate form of payment and are forbidden for use in all financial transactions.

A number of the world’s central banks, and the governments responsible for them, have called for tighter regulation of cryptocurrencies in order to prevent misuse, deter anonymous trading and boost transparency.

However, despite previous reports of a potential shutdown, South Korea has “no intention” of halting cryptocurrency trading, according to a recent statement by the country’s finance minister Kim Dong-yeon.

We’ve compiled a list of exchanges where you can buy and sell crypto, plus digital wallets to hold them and a list of the most popular alternative coins on the market. You can also stay up to date with the latest news.

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

Latest cryptocurrency news

Picture: Shutterstock

Ask an Expert

You are about to post a question on finder.com:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Privacy and Cookies Policy and Terms of Use.
Go to site