Bitcoin transactions suffer steep decline in China on government crackdown

March 4, 2020

By Sharan Kaur Phillora

China’s central bank said on Thursday (March 3) that Bitcoin transactions originating from the country have plummeted to 10% from 90% of the total worldwide.

Here’s everything you need to know:

  • China banned trading in Bitcoin as early as 2013 and outlawed centralized crypto exchanges in 2017. The nation’s supreme court further threatened those involved in fundraising through crypto sales with up to 10-year jail sentences last month.
  • There is no surprise that this decline in the Bitcoin transaction is in part due to Beijing’s intensifying crackdown on cryptocurrency trading and mining over the last decade.
  • According to a statement from the People’s Bank of China, the crackdown is also part of China’s efforts to restore order in its domestic financial market.
  • In February, China’s Supreme Court established penalties for violating the country’s prohibitions against engaging in cryptocurrency transactions.
  • The bank said the move was a national security measure, designed to also protect investors from risk. The PBOC pointed to illicit activities tied to cryptocurrencies — gambling, pyramid schemes, money laundering — mentioning bitcoin by name.
  • The announcement also comes on the heels of international financial regulators’ discussion on how to prevent Russia from circumventing sanctions using cryptocurrency. The U.S. is prodding exchanges to thwart crypto use by sanctioned Russians.

 


About the author

Sharan Kaur Phillora’s thirst for knowledge has led her to study many different subjects, including NFTs and Blockchain technology – two emerging technologies that will change how we interact with each other in the future. When she isn’t exploring a new idea or concept, she enjoys reading literary masterpieces.

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