Cryptocurrencies are not a welcome topic within much of mainstream life throughout the world, although that is starting to change, and there are some countries that have outright banned Cryptocurrency trading. China is one such example where the government declared the trading of any form of Cryptocurrencies to be illegal. Hence leading to a recent statistic stating that the current volume of Bitcoin traded in China in the form of renmibi or RMB is worth less than 1% of all BTC traded globally. As one can imagine the Chinese government is over the moon at this statistic.
The Breaking News
The transition to less than 1% is huge, especially considering that at the peak of Bitcoin trading in China, the Chinese citizens were responsible for almost 90% of all Bitcoin trading globally. However, the ramifications of the People’s Republic’s government legislation with regard to Cryptocurrencies were expected to be especially immense, due to the presence of Cryptocurrencies in China. Many hundreds of Crypto startups had to pull out of the country in a rush, due to the new legislation. Since the statistic was reported on a government-run news network within China and the news broadcast did not cite the official source of data, there is no way for external researchers to verify the claim as yet.
The Reason Behind The Law
The main purpose behind the government’s motive of disabling any avenue for citizens to trade in Cryptocurrencies is the fact that the Crypto markets are not fully established and are thereby prone to liabilities and security risks. In addition, the legislation also curbed any possibility of a business operating within China using initial coin offerings or ICO’s to fundraise for their product. The government’s desire to safeguard it’s citizens from any possible financial or security risks with regard to Cryptocurrencies was further proven by it’s recent statements regarding the 88 exit plans it had provided. These exit plans would cover all major Cryptocurrency platforms operating within China, as well as 85 of the biggest ICO platforms that were used within the country.
Additional Anti-Crypto Measures
In addition, China has somehow ensured that no advertisements or marketing campaigns featuring Cryptocurrencies, ICO’s or blockchain are making it into the social media news feeds of their citizens. Moreover, there is also no Cryptocurrency adverts in the search browsers, this has caused many to believe that the Chinese government has censored all Crypto marketing campaigns and content that it’s citizens may want to access. This is exceedingly efficient considering the Chinese government only had all Cryptocurrency related businesses and platforms effectively shut down as of September 2017.
Yet, the Chinese government was also clever to have the foresight to block access to foreign Cryptocurrency trading platforms and startups. Hence, the implications of this legislation was that many international Cryptocurrency platforms that had initially established their base in China had to relocate immediately or risk being shut down. Therefore, they relocated out to Singapore, the United States, Japan and right across the border to Hong Kong as well. Some of the world’s biggest Crypto platforms including Binance left China, which has prompted many to wonder if China may ever reconsider the legislation regarding Cryptocurrencies, even if only to lure back big businesses?