Last Friday the State Council Financial Stability and Development Committee, a body charged with managing risk in China’s financial system, issued a

China announces ‘crackdown’ on bitcoin mining and trading

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2021-05-24 02:00:02

Last Friday the State Council Financial Stability and Development Committee, a body charged with managing risk in China’s financial system, issued a statement detailing its most recent meeting and conclusions about the most pressing risks it needs to manage.

After first mentioning less-specific issues such as building early warning systems to detect financial risks, and reforming smaller financial institutions, the statement said it’s time to “crack down on Bitcoin mining and trading behaviour” as the cryptocurrency and other risks mentioned could introduce external risks, or inflation, or both.

The Committee’s identification of Bitcoin as undesirable came just days after China’s Internet Finance Association, Banking Association, and the Payment and Clearing Association issued a joint statement banning banks from offering access to cryptocurrency investments, while web platforms were barred from hosting crypto companies’ operations or even ads for their wares.

The new statement didn’t specify what actions would be taken against Bitcoin operators, other than saying China will “severely punish” illegal activities. However, the impact of the ban is likely to be felt outside China, as the nation is one of the major sources of miners.

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