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Prime Minister demonitised Rs 500 and Rs 1,000 notes and it was a secret kept well. In his address to the nation, Modi said work on having new currency notes and clamping down on black money had started six months back and the entire operation was kept top secret. 
 
Modi government told the RBI to be all set for this bold move on black money, around six months ago. Before that, Modi had made the decision to phase out the current Rs 500 and Rs 1,000 notes. 
 
Modi made it a point that nobody gets to know about it, not even his own Cabinet as replacing 23 billion currency notes was going to be a gargantuan task. 
 
Modi sought to stop the transaction of black money with the aim of giving the economy a veritable leg-up. He knew if the move was a success, people would be compelled to use only legitimate transaction networks, which would automatically make the government's tax kitty bigger. 
 
As per the reports, officials that were involved in the demonetisation process were quarantined and notification on the move was printed in secrecy in the same press where the Union Budget papers were printed. The Cabinet members weren’t allowed to leave the room until the Prime Minister ended the address. 
 
Given the context of the crucial upcoming assembly elections in Uttar Pradesh, the move is aimed at giving BJP a "strong talking point, about "a decisive government,. Further, the ban on high-denomination notes is likely to have an impact on election expenditure in UP. 
 
Coming ahead of assembly elections in UP, the move is also likely to provide another campaign pitch for BJP.

Here’s how Modi kept his master plan to flush out black money, introduce new currency under wraps

The <keyword id="3315394" type="UNKNOWN" weightage="20" keywordseo="demonetisation">demonetisation</keyword> of currency has made the entire nation undergo a cash crunch and this has affected the market in a very bad way. Along with many markets, smartphone market is also facing the problems regarding sales. Inventories are piled up with devices and people don’t have enough new banknotes for purchase and this may force the mobile handset makers to alter production schedules and defer new launches. 
 
According to reports, the situation has turned worse since the demonetisation announcement on November 8 and it may also affect shipment numbers for mobile makers in October-December quarter. 
 
"Dealers have been sitting idle, some shops are also closed, because consumers are not coming to buy phones and sellers are not accepting old currency notes.There's an inventory pile-up happening and this dry spell will continue till November 25, till the time cash is easily accessible to consumers," Ravinder Zutshi, mobile council head at Consumer Electronics and Appliances Manufacturers Association (CEAMA) told ET. 
 
According to a report by ET, smartphone sales are down by about 70-80% from pre-demonetisation days and this have led to a serious pile up in inventories as smartphones are generally bought with cash. 
 
"There are no customers. Our existing stock isn't selling, so where is the question of ordering more stock," Rajesh Chauhan, owner of a small brick-and mortar shop, told ET. 
 
Consumers have put large appliances and smaller electronic items such as phones lower down on their priority lists after the government banned use of Rs 500 and Rs 1,000 currency notes from last Wednesday. 
 Handset makers such as <keyword id="71696" type="COMPANY" weightage="20" keywordseo="Micromax">Micromax</keyword>, <keyword id="6355189" type="PERSON" weightage="20" keywordseo="lava">Lava</keyword> and <keyword id="1188106" type="COMPANY" weightage="20" keywordseo="Gionee">Gionee</keyword>, television and white goods makers are all watching the situation closely , amid the inventory pile-up, but are yet to take a call on modifying their production schedules. 
 
The inventory pile-up for TV and white goods industry is still insignificant as of now since the industry anyway adjusts its production after Diwali when sales as a routine take a dip, added industry insiders. 
(image: IndiaTimes)

Demonetisation is delaying new smartphone launches. Here’s how

My wallet has no legal money today; I can say the same for my friends, family and colleagues but we all have a smile on our face! The historic move by <a href="http://www.businessinsider.in/searchresult.cms?query=Prime+Minister+Narendra+Modi&amp;sortorder=effectivedate">Prime Minister Narendra Modi</a> this week, announcing <a href="http://www.businessinsider.in/searchresult.cms?query=demonetization+&amp;sortorder=effectivedate">demonetization </a>of Rs 500 and 1000 currency notes is a significant step to check black money and corruption, twin issues that have been crippling many new and young or prospective businesses in India including upcoming and established start-ups. 
 
Many of our businesses find themselves struggling to operate in markets riddled with lack of hard and soft infrastructure, cash and back money riddled markets and sectors virtually closed for legit business. All that is set to change and I am confident it’s for the good! 
 
The 3 cheers I am expecting to come about... 
 
The financial infrastructure we have longed for 
 
For the last decade various new age businesses, start-ups have been struggling with abysmal financial infrastructure based largely on cash. While some of us have been working to get the financial infrastructure in place (read mobile wallets, payment gateways, and others), many more are creating alternate mechanisms to operate in the current financial mechanisms (read Cash on Delivery, cash backs on card payments, etc) making our businesses unviable. 
 
So far it was a few of us who were promoting an electronic, plastic, cashless economy, this move is set to align the government, most businesses – big or small; new or traditional to promote the same! Cheers! 
 
Fair play across sectors! 
 
India is a country struggling with fundamental in-efficiencies and lack of infrastructure – both hard such as organized retail, construction, logistic, housing, telecommunication, etc and soft infrastructure – credit systems, free market trading, waste management, health services, financial products, education, etc. Many of these sectors, ecosystems have been largely in-accessible to the “common” entrepreneur primarily because of the extensive funding and/or dealings in these sectors with illegitimate cash. Now I look forward to a level playing field in many of these sectors, businesses where entrepreneurs will bring in innovation, high quality of service and eventually disruption! Cheers! 
 
Less cash, less black money, more transparency! 
 
While they might have the best products or solutions for the need, often you hear entrepreneurs say, ‘we don’t compete for this kind of business’. The kind of business where we find our capabilities in delivering innovation, value and exemplary service are not enough to legitimately win business. Or the kinds of business which survive on stealing on taxes! I am hoping this is going to start to change too. We will see more transparency in the economy, in its dealings and hence more young businesses to compete fairly, to grow and flourish. Cheers! 
 
Three cheers to our Prime Minister for a bold, far reaching and game-changing action. The move will launch business opportunities for genuine trade to flourish and re-energize the young and dynamic startup ecosystem. 
 
 Himanshu Aggarwal is the Co-founder &amp; CEO of Aspiring Minds. 
(image: IndiaTimes)

Demonetization has come as a boon for startups. Here’s how

<ul><li><keyword id="3658" type="COUNTRY" weightage="20" keywordseo="India">India</keyword>’s central bank, the <keyword id="6354335" type="ORGANIZATION" weightage="20" keywordseo="reserve-bank-of-india">Reserve Bank of India</keyword>, refused to state the cost incurred in the destruction of banned currency notes when questioned by <keyword id="55120" type="ORGANIZATION" weightage="20" keywordseo="Right-To-Information">Right to Information</keyword> (RTI) activist. </li><li>However, the bank revealed that of the total junked currency, ₹107.2 billion did not return to the banking system post <keyword id="3315394" type="PERSON" weightage="20" keywordseo="demonetisation">demonetisation</keyword>. </li><li>The invalidated notes were destroyed through the currency verification machines and processing system. </li></ul>A large amount of money was returned to the banks post demonetisation but when the Reserve Bank of India (RBI) was questioned under the Right To Information (RTI) Act, it refused to reveal the cost of destroying the banned currency <a href="https://www.businesstoday.in/current/economy-politics/rbi-refuses-to-disclose-cost-of-destroying-banned-notes-after-demonetisation/story/288827.html">amounting to</a> nearly ₹15.3 trillion. In response to a query by Chandrashekhar Gaud, posted on 29 October under the RTI Act, RBI got away with saying that the process of destruction of the banned currency notes was over by March 2018. The bank also mentioned that the invalidated notes <a href="https://www.bloombergquint.com/markets/rbi-refuses-to-state-how-much-destruction-of-banned-notes-cost-rti#gs.8X2b9zQ">worth</a> ₹107.2 billion did not return to the banking system in the first place. On further questioning by Gaud, on how much the destruction of banned currency cost, the reply had no numbers from RBI. In fact, the bank said that the information was unavailable and that providing it would ‘disproportionately divert the resources’, citing Section 7(9) of the RTI Act. All of this information was sourced from the <a href="https://www.rbi.org.in/scripts/AnnualPublications.aspx?head=Department%20of%20Currency%20Management">Department of Currency Management</a> of RBI, which said that the banned currency was destroyed through the currency verification machines. Questions unanswered Even on being asked about the number of ₹500 and ₹1000 notes that were destroyed, the bank had nothing to offer. However, the bank had earlier informed the public that nearly 99.3% of the total demonetised money was returned to the bank. During the advocated time-frame of demonetisation the RBI successfully aggregated ₹15.3 trillion. But, if we go back to when demonetisation was originally announced, in November 2016, over 15.4 trillion in denominations of ₹500 and ₹1000 were in circulation.

India’s central bank refused to disclose the cost of destroying banned notes after demonetisation

<keyword id="204019" type="ORGANIZATION" weightage="100" keywordseo="Nepal-Rastra-Bank">Nepal Rastra Bank</keyword> on Thursday banned the use of India’s new currency notes of Rs 500 and Rs 2,000 denomination, terming them “unauthorised and illegal”. These two currency notes were issued by the <keyword id="6354335" type="CITY" weightage="100" keywordseo="reserve-bank-of-india">Reserve Bank of India</keyword> recently after old Rs 500 and Rs 1,000 denomination notes were withdrawn. <keyword id="12266" type="COUNTRY" weightage="100" keywordseo="Nepal">Nepal</keyword> Rastra Bank (NRB) has called the new currency notes “unauthorised and illegal”. 
 NRB spokesperson Narayan Poudel said these new currency notes are not yet legal in Nepal, according to Onlinekhabar.com. Poudel said these notes will be legal in Nepal only when India issues a FEMA notification as per the <keyword id="6368276" type="COMPANY" weightage="100" keywordseo="Foreign-exchange">Foreign Exchange</keyword> Management Act. India is likely to issue a FEMA notification, allowing people in Nepal and India to possess certain amount of Indian currency. Earlier, a ban was in effect in Nepal till last year against the use of Rs 500 and Rs 1,000 denominations notes. Authorities had lifted this ban after the visit of Prime Minister <keyword id="6354477" type="PERSON" weightage="100" keywordseo="Narendra-Modi">Narendra Modi</keyword> to Nepal. Nepal last year allowed people to carry Indian Rupees of higher denominations upto Indian Rs 25,000. 
The Reserve Bank of India had formed a task force to ease currency exchange facility in Nepal for non-Indians who possess the now-defunct notes of 500 and 1,000 denominations.

Nepal bans use of new Indian Rs 500 and Rs 2000 notes, calls them illegal

The government has suspended over-the-counter exchange of old notes from today midnight. 
 
It said that the Rs 500 notes will be allowed till December 15 in places where it is already being accepted. 
 
Rs 1,000 notes will not be eligible for exemption, the government announced. There is a complete ban on the usage of these notes from today midnight. 
 
Rs 1000 notes will not be accepted at petrol pumps and government hospitals. 
 
Foreign citizens will be permitted to exchange foreign currency upto Rs 5,000 per week. Entry to this effect will be made in their passports. 
 
Old Rs 500 notes will be allowed for government school and college fees.

Demonetisation: Today is the last day for over-the-counter exchange of old notes

<ul class="summary-list"><li>The <keyword id="11892778" type="UNKNOWN" weightage="60" keywordseo="taliban" source="Orion">Taliban</keyword> banned the use of foreign currency in <keyword id="11892774" type="UNKNOWN" weightage="60" keywordseo="afghanistan" source="Orion">Afghanistan</keyword>.</li><li>The country is on the brink of financial collapse since the group seized power.</li></ul>The Taliban banned the use of foreign currencies in Afghanistan, which is on the brink of financial collapse after the group ousted the previous government.The Taliban said, <a href="https://www.bbc.co.uk/news/business-59129470">according to the BBC</a>: "The economic situation and national interests in the country require that all Afghans use Afghani currency in their every trade."While the country uses the Afghani currency, the US dollar is <a href="https://www.reuters.com/world/asia-pacific/running-out-dollars-afghan-banks-ask-taliban-more-cash-2021-09-15/">also widely used</a>.The United Nations has <a href="https://www.insider.com/world-food-program-14-million-afghans-starve-without-aid-afghanistan-2021-8">warned</a> that millions of people could starve in Afghanistan, citing the Taliban takeover as a factor in the crisis.Since the Taliban took power in August, it has been prevented from accessing financial assets held overseas.The US in August <a href="https://www.bloomberg.com/news/articles/2021-08-17/u-s-freezes-nearly-9-5-billion-afghanistan-central-bank-assets">froze</a> nearly $9.5 billion in assets that belong to Afghanistan's central bank. <a href="https://www.businessinsider.com/federal-reserve-bank-of-new-york-holds-billions-from-afghanistan-2021-8">Most of that money is held</a> by the Federal Reserve Bank of New York.The UN <a href="https://thehill.com/policy/international/571608-un-urges-release-of-afghanistans-frozen-assets-to-prevent-severe">said in September</a> that the assets should be unfrozen to avoid "a severe economic downturn."An October <a href="https://www.thetimes.co.uk/article/us-refuses-to-release-billions-to-taliban-in-first-face-to-face-talks-srfzd3g3l">report from The Times of London</a> said that Taliban officials asked the US to unfreeze the assets in a face-to-face meeting, but did not make any headway."The issue has not reached any conclusion. There are deadlocks on the issues from both sides," an unnamed Taliban official told the newspaper.The International Monetary Fund said Afghanistan can't access its resources anymore, and The World Bank announced it would no longer give funding to <a href="https://www.bbc.co.uk/news/business-58325545">projects in the country</a>.Some parents in Afghanistan are <a href="https://www.cnn.com/2021/11/01/asia/afghanistan-child-marriage-crisis-taliban-intl-hnk-dst/index.html">selling their children</a> out of desperation for money, <a href="https://www.businessinsider.com/reviews/out?u=https%3A%2F%2Fwww.wsj.com%2Farticles%2Fas-afghanistan-sinks-into-destitution-some-sell-children-to-survive-11634387501">according to multiple reports</a>.

The Taliban banned foreign currencies as Afghanistan nears financial collapse with billions frozen overseas

<ul class="summary-list"><li>China's ban on <keyword id="11893898" type="UNKNOWN" weightage="60" keywordseo="crypto" source="Orion">crypto</keyword> transactions sent the price of bitcoin lower, but the move was relatively small. </li><li>An expert said the move had mostly been priced in. </li><li>Bitcoin hovered near $40,000 on Friday, a slide of around 6% in the past 24 hours, as of publishing.</li></ul>China on Friday intensified its crackdown on digital assets by banning all cryptocurrency transactions, in what's been seen as the country's strongest restriction on the sector so far.On Friday, the People's Bank of China said in a <a href="https://mp.weixin.qq.com/s/4QWsmCyksuDGQO8eKiixwA" target="_blank" rel="noopener">statement</a> that virtual currencies "are not legal and should not and cannot be used as currency in the market."They do not have the same legal standing as fiat currency, the central bank added, since they are issued by non-monetary authorities and use encryption technology.The move came after the Asian superpower banned <a href="https://markets.businessinsider.com/news/currencies/bitcoin-price-btc-china-mining-crackdown-sichuan-cryptocurrencies-ether-2021-6?utm_source=markets&amp;utm_medium=ingestgest" target="_blank" rel="noopener">cryptocurrency mining</a> and barred financial institutions from <a href="https://markets.businessinsider.com/news/currencies/bitcoin-price-rally-china-bans-banks-crypto-business-btc-2021-5?utm_source=markets&amp;utm_medium=ingestgest">offering cryptocurrency services</a> earlier this year.The news sent <a href="https://markets.businessinsider.com/currencies/btc-usd?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingestm=ingest" target="_blank" rel="noopener">bitcoin</a> hovering around $42,000 on Friday, a drop of around 8% in 24 hours, according to CoinDesk data. The price of the digital asset bounced back over the weekend. Though crypto <keyword id="11893875" type="UNKNOWN" weightage="100" keywordseo="markets" source="Orion">markets</keyword> initially slumped, bitcoin's price reaction was muted compared to <a href="https://markets.businessinsider.com/news/currencies/china-crypto-crackdown-timeline-regulatory-bitcoin-ether-solana-dogecoin-bans-2021-9">previous clampdowns</a>, mainly since the news was viewed as a confirmation of previous bans, Wes Fulford, CEO at investment advisor Viridi Funds, said. "We are seeing the crypto markets down in price, however, the reaction is significantly smaller than previous bans as the market has already priced in the risk of China banning cryptocurrency transactions," Fulford said in a note Friday.Fulford said that bitcoin, in particular, showed resilience compared to <a href="https://markets.businessinsider.com/news/currencies/bitcoin-price-today-ether-altcoins-china-cryptocurrency-ban-transactions-illegal-2021-9">other cryptocurrencies</a>, such as <a href="https://markets.businessinsider.com/currencies/eth-usd?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingestm=ingest" target="_blank" rel="noopener">ether</a>, as well as other major altcoins including <a href="https://markets.businessinsider.com/currencies/xrp-usd?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingestedium=ingest" target="_blank" rel="noopener">ripple</a>, solana, and <a href="https://markets.businessinsider.com/currencies/doge-usd?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingestedium=ingest" target="_blank" rel="noopener">dogecoin</a>, which all fell.While there was a substantial volume increase around the time of the news, only about 37% of the bitcoin-US dollar volume was traded in the two hours between 5 and 7 a.m. ET Friday, data from cryptocurrency exchange Bitstamp showed. After which, prices recovered and volumes fell, Bitstamp said, indicating that the markets have largely processed the information."Interestingly however it is not looking like it will become a record day in terms of volume, not even in September," Bitstamp said, adding that September 24 ended up to be the fourth-highest volume day of the month.<a href="https://twitter.com/dwr/status/1441418811962380299?s=20">Memes</a> even circulated on social media, mocking China's latest announcement as just the latest in a string of <a href="https://markets.businessinsider.com/news/currencies/china-crypto-crackdown-timeline-regulatory-bitcoin-ether-solana-dogecoin-bans-2021-9">similar moves dating back to 2013</a>. Bitcoin bull and Microstrategy CEO Michael Saylor took to <a href="https://twitter.com/michael_saylor/status/1441389129665818626?s=20">Twitter</a> to question the ban as well."Nothing has created more wealth in the past decade than technologies banned in China."For Tim Frost, CEO of Yield App, a fintech app, the ban was expected. Anyone who was hoping for a reversal, he said, will just end up "disappointed.""China has made its intentions very very clear: Like all authoritarian regimes, it wants extremely tight control over all financial activity in the country, and it wants zero competition for its own central bank digital currency," he said via email Friday.Compared to other nations, China is <a href="https://markets.businessinsider.com/news/currencies/china-digital-yuan-years-ahead-in-development-cbdc-cryptocurrencies-chainalysis-2021-8">several years ahead</a> in its efforts to develop a central bank digital currency. Around 60 central banks are developing or considering issuing digital currencies, according to the <a href="https://markets.businessinsider.com/news/currencies/central-bank-digital-currencies-cbdc-crypto-bofa-cryptocurrencies-economy-2021-7">Bank for International Settlements</a>, but none have advanced their plans as far as China has."Thankfully there is no shortage of countries and jurisdictions that are now embracing cryptocurrency," Frost added. "So while the loss of the world's most populous nation is a blow, most of the damage had been done some time ago."

China banned all crypto transactions on Friday, but experts say the move was mostly priced in for bitcoin

<ul><li>Florida Governor Ron DeSantis proposed legislation banning digital currency from the US central bank.</li><li>The Fed has been looking into the creation of a digital dollar at the direction of President Biden.</li><li>DeSantis said a Fed-issued digital coin would promote surveillance and stifle innovation.</li></ul>Florida Governor Ron DeSantis is not on board with the potential launch of a central bank digital currency by the Federal Reserve.On Monday, DeSantis <a href="https://www.flgov.com/2023/03/20/governor-ron-desantis-announces-legislation-to-protect-floridians-from-a-federally-controlled-central-bank-digital-currency-and-surveillance-state/" target="_blank" rel="noopener">proposed legislation</a> that would make Florida the first state in the country to ban the use of digital currencies issued by the Fed or any foreign central bank. The Fed has been studying the feasibility of a CBDC at the direction of President Joe Biden.A <a href="https://www.businessinsider.com/personal-finance/cbdc">CBDC is a digital version of an existing currency that,</a> like its physical fiat counterpart, would be backed by the full faith and credit of the issuing government. Talk of CBDC's heated up during the cryptocurrency boom of 2020 and 2021, which put pressure on governments to explore the potential issuance of their own digital currency.Proponents of CBDCs argue that a digital dollar would enable faster transactions with lower fees, improved efficiency with cross-border exchanges, and improved accessibility to the unbanked population.But according to DeSantis, a digital currency issued by the Fed "is about surveillance and control" and would ultimately hurt innovation."The Biden administration's efforts to inject a centralized bank digital currency is about surveillance and control. Today's announcement will protect Florida consumers and businesses from the reckless adoption of a 'centralized digital dollar' which will stifle innovation and promote government-sanctioned surveillance," DeSantis said.DeSantis also argued that any digital currency issued by the Fed would diminish the role of community banks, which have come into focus this month amid the ongoing regional banking crisis."A federally sanctioned CBDC as proposed by the Biden administration would diminish the role of community banks and credit unions in our financial system as CBDC currency would be a direct liability of the Federal government, rather than of a chartered financial institution, shrinking market lending power," DeSantis said. While there is no official timeline for the launch of a Fed-issued digital dollar, or even confirmation that the Fed will move forward with one, it is set to launch its FedNow Service in July. FedNow Service is a real-time payments system that is meant to eliminate the existing delays for clearing financial transactions between different institutions. Some view the launch of the FedNow Service as <a href="https://www.coindesk.com/policy/2023/03/15/us-federal-reserves-real-time-payments-system-coming-in-july/" target="_blank" rel="noopener">a potential precursor to the launch of a CBDC.</a>DeSantis called on likeminded states to "join Florida in adopting similar prohibitions within their respective commercial codes to fight back against this concept nationwide."

Florida Governor Ron DeSantis proposes banning a digital currency from the Fed, arguing it will stifle innovation and promote surveillance

s de<ul><li><keyword id="11892748" type="UNKNOWN" weightage="60" keywordseo="china" source="Orion">China</keyword>'s decision to ban cryptocurrency transactions sent <keyword id="11893902" type="UNKNOWN" weightage="60" keywordseo="bitcoin" source="Orion">bitcoin</keyword> down as much as 8% on Friday.</li><li>But the country has been trying to rein in the digital asset sector for nearly a decade.</li><li>Here's a timeline of all the regulatory actions China has imposed on <keyword id="11895317" type="UNKNOWN" weightage="60" keywordseo="cryptocurrencies" source="Orion">cryptocurrencies</keyword>.</li><li><a href="https://newsletter.businessinsider.com/join/4np/10-things-opening-bell?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingestm_medium=ingest?utm_source=markets&amp;utm_medium=ingest" target="_blank" rel="noopener">Sign up here for our daily newsletter, 10 Things Before the Opening Bell</a>.</li></ul>It was deja vu all over again for some cryptocurrency investors on Friday after <a href="https://markets.businessinsider.com/news/currencies/bitcoin-price-today-ether-altcoins-china-cryptocurrency-ban-transactions-illegal-2021-9">China said it would ban all cryptocurrency-related transactions.</a>The People's Bank of China said in a <a href="https://mp.weixin.qq.com/s/4QWsmCyksuDGQO8eKiixwA" target="_blank" rel="noopener">statement</a> that virtual currencies "are not legal and should not and cannot be used as currency in the market." Bitcoin fell as much as 8% on Friday following the news, while several other <keyword id="11893898" type="UNKNOWN" weightage="60" keywordseo="crypto" source="Orion">crypto</keyword> coins like <keyword id="11896271" type="UNKNOWN" weightage="60" keywordseo="ether" source="Orion">ether</keyword>, litecoin, and Solana fell nearly 10%.But China's hostile stance to bitcoin has been well known, as the country implemented its first "ban" in 2013. Since then, China has been attempting to rein in the booming digital asset sector with various restrictions targeting different areas of the market.Today's moves were the most forceful so far against cryptocurrencies. Still, despite all of the bans, Beijing has stopped short of making it illegal for Chinese citizens to hold onto their digital cryptocurrencies.Here's a timeline of all the regulatory actions China has imposed on cryptocurrencies since 2013, many of which occurred amid a volatile rally in bitcoin and other altcoins.December 2013: China bans banks from handling bitcoin transactionsThe People's Bank of China said <a href="https://www.bbc.com/news/technology-25233224">in a statement</a> that bitcoins are a "virtual good" that has no legal status and shouldn't be used as a currency. This was effectively the first ban towards crypto applied to major financial institutions within the country. Many believe the ban was implemented due to a surge in interest among Chinese citizens amid a strong bull run in bitcoin. September 2017: China orders local cryptocurrency exchanges to cease operationsThe country <a href="https://www.businessinsider.com/china-ban-bitcoin-exchanges-2017-9">banned initial coin offerings</a> and ordered all domestic cryptocurrency exchanges to end operations within the country. The move came amid a strong bull market for bitcoin which eventually topped out near $20,000 in late 2017.May 2021: China bans various financial institutions and payment firms from offering crypto servicesThe country <a href="https://markets.businessinsider.com/news/currencies/bitcoin-price-rally-china-bans-banks-crypto-business-btc-2021-5">reiterated its prior bans</a> from 2013 and 2017, citing the dangers of speculative trading in the crypto coins, and cemented the ban for various payment platforms and business activities related to cryptocurrencies.June 2021: China ramps up crypto mining crackdownThe country set its eyes on <a href="https://markets.businessinsider.com/news/currencies/bitcoin-price-btc-china-mining-crackdown-sichuan-cryptocurrencies-ether-2021-6">banning cryptocurrency mining</a> with various regulations towards the sector. Following the new rules, <a href="https://markets.businessinsider.com/news/currencies/crypto-trading-volume-bitcoin-china-cryptocurrency-mining-volatility-2021-07">bitcoin mining immediately moved overseas</a> to more crypto friendly countries, including the US. China cited environmental concerns and excessive energy consumption as reasons for its new restrictions. September 2021: China bans cryptocurrency-related transactionsThe country made <a href="https://markets.businessinsider.com/news/currencies/china-crypto-bans-cryptocurrency-transactions-forbids-foreign-exchanges-service-citizens-2021-9">cryptocurrency-related transactions illegal</a> and forbid overseas exchanges from serving its citizens. Coins such as bitcoin and ether "are not legal and should not and cannot be used as currency in the market," the People's Bank of China said in a <a href="https://mp.weixin.qq.com/s/4QWsmCyksuDGQO8eKiixwA" target="_blank" rel="noopener">statement</a>. The ban effectively ends trading for cryptocurrencies, though it is currently not illegal for its citizens to hold the asset.

China's crypto crackdown is shaking markets, but it's been trying to rein in the sector for years. Here's a timeline of Beijing's regulatory sweep.

<div class="image-container display-table float_right"><div><div class="image">Nicholas Carlson</div></div></div>BEIJING (Reuters) - China's biggest online marketplace, Alibaba Group Holding Ltd's Taobao, will ban the sale of bitcoins on the heels of a government crackdown against the virtual currency to plug a potential gap in its tight controls on capital flows.
The move comes as Alibaba, China's biggest e-commerce company, seeks the smoothest of rides toward a giant initial public offering of stock expected later this year. In a statement posted on its website late on Tuesday, Taobao said the ban is effective from January 14.
Taobao's move to fall in line with the government's wishes also comes as Alibaba presses on with efforts to stamp out the sale of fake goods on the online marketplace ahead of the IPO. Alibaba has been conservatively estimated to be worth over $100 billion.
"The central bank clearly has required third-party payment services to close <keyword id="6354947" type="UNKNOWN" weightage="60" keywordseo="Bitcoin">bitcoin</keyword>...trading channels," Taobao said in its statement, without disclosing any details on bitcoin sales through its platform up to now. Backed by neither a government nor a bank, bitcoin has attracted currency speculators in recent months.
Alibaba spokeswoman Florence Shih said, "In the interest of consumer protection, Taobao has banned the sale of bitcoins on the platform."
Taobao uses Alibaba's online payment affiliate Alipay to process transactions across the world's second-biggest economy, handling over 1 trillion yuan ($165 billion) in annual sales volume together with its sister shopping portal T-Mall.
The Taobao ban, which covers other virtual currencies, also includes the sale of any guides, computer hardware or software related to bitcoin "mining". In the mining process users can mint new bitcoins of their own by having a computer solve complex mathematical problems.
Most bitcoin sales take place on specialized electronic platforms, rather than online marketplaces like Taobao, that are designed to trade the virtual currency for various physical currencies.
In December, the People's Bank of China (PBOC) banned financial institutions from trading in bitcoins, saying the government would act to prevent money laundering risks from bitcoin, which is not backed by a government or central bank. It did not ban individual trading.
Later the same month, the Chinese Business News reported that the government had asked third-party payment services to stop handling bitcoin transactions, forcing Shanghai-based BTC China, the world's largest bitcoin exchange platform by volume, to stop taking Chinese yuan deposits.
"I think it's overreaching," said Bobby Lee, Chief Executive Officer of BTC China, referring to Taobao's ban on bitcoin-related accessories. "I think they're trying to just win favors from the government."
The PBOC stance reflects the fact that the bitcoin trade represents a potential hole in the country's capital controls. They are minted anonymously, untraceable, and can be carried on memory sticks or transmitted electronically.
However, analysts say that given the total value of bitcoins in circulation remains tiny relative to other currencies, the trade is unlikely to have much impact on the wider economy for now.
The price of bitcoins on BTC China fell 15 percent on Tuesday to 4718.51 yuan, but had bounced back 4.5 percent by late afternoon on Wednesday.
($1 = 6.0512 Chinese yuan)
(Reporting by Adam Rose; Additional reporting by Paul Carstens in BEIJING; Editing by Kenneth Maxwell)

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