China is moving to eliminate all cryptocurrency trading with a ban on foreign exchanges
- China has previously taken steps to curb cryptocurrency trading in the country, but recent moves may eliminate trading in the country completely.
- People's Bank of China said on Sunday that it would block access to all domestic and foreign cryptocurrency exchanges and ICO websites.
- China already banned Bitcoin exchanges in late 2017 as a way to stem online trading, but the attempt failed to eliminate cryptocurrency trading completely.
- The cryptocurrency market has lost $340 billion of value since the start of January, and many speculate it has much to do with a regulatory crackdown in Asia.
China has previously taken steps to curb cryptocurrency trading in the country, but recent moves may eliminate trading in the country completely.
A news publication affiliated with the People's Bank of China (PBOC) said in an article on Sunday that it would block access to all domestic and foreign cryptocurrency exchanges and ICO websites, the South China Morning Post reported.
China already banned bitcoin exchanges in late 2017 as a way to stem online trading, but the attempt failed to eliminate cryptocurrency trading completely.
"ICOs and virtual currency trading did not completely withdraw from China following the official ban," the article said, according to SCMP.
Instead, many traders turned to foreign exchanges to make cryptocurrency transactions.
"Overseas transactions and regulatory evasion have resumed … risks are still there, fueled by illegal issuance, and even fraud and pyramid selling," the article said.
ICOs are a cryptocurrency-based fundraising method that has become popular with startups to raise money. Some industry experts have warned that many ICOs are fraudulent, and operate in the gray area as they remain unregulated.
China news agency Xinhua said the PBOC would tighten its regulations on domestic crypto investors engaging in foreign transactions of ICOs and virtual currency as the market remains unstable.
Earlier this month, the PBOC prohibited financial institutions from providing any funding to activities related to cryptocurrencies.
The bans have already affected major cryptocurrency exchanges in the country. In September, Shanghai-based bitcoin exchange BTCC announced the closure of its China trading operations.
According to the Post, China's moves to ban cryptocurrency trading in the country has yet to deter individual investors, who move their trading to other areas like Hong Kong or Japan while still raising funds from mainland investors.
It's uncertain whether new regulations will be effective in eliminate trading in the country completely, as China houses some of the world's largest bitcoin mines. However, many agree that the moves will certainly have an impact on the Bitcoin market overall.
Stricter regulations by the PBOC will "definitely weigh on the cryptocurrency universe," Wayne Cao, who runs a company that recently offered 10 billion tokens in an ICO, told the Post.
Cao added that most of the Chinese ICO's, are invested in by Chinese investors, so a complete cryptocurrency shutdown would drag the entire cryptocurrency market down.
The bitcoin market has seen increased volatility in the last month, and many have speculated that the bitcoin bubble may soon burst.
Bitcoin was trading below $8,000 a coin on Monday and closed in on $7,000 for the first time since November. Bitcoin is now at less than half its December peak of over $19,000.
The cryptocurrency market has lost $340 billion of value since the start of January, and many speculate it has much to do with a regulatory crackdown in Asia.
This month, South Korea considered banning all cryptocurrencies exchanges in the country, which sent the market plummeting and caused mass panic.
The country did not ban all crypto trading, however did tighten regulations on anonymous trading, and has set the tone for other countries looking to crackdown on the cryptocurrency market.