Two financial watchdogs in Beijing, the Beijing Local Financial Supervision and Administration Bureau and the Business Management Department of China’s Central Bank (PBoC) are shutting down firms that offer cryptocurrency-related services that enable crypto-trading.
According to their joint statement, both regulators are implementing the crackdown on virtual currency transactions as per a directive by the Party Central Committee and the State Council. As stated in the announcement, the move is aimed at preventing and controlling the risks of virtual currencies and protecting the safety of its citizens’ properties.
One particular firm, the Beijing Tongdao Cultural Development has permanently been shut down under the suspicion of “providing software services to crypto-trading activities.” The company was founded in 2016 and has been providing services across different sectors including entertainment, public relations, Marketing, and modeling.
The statement further asserted that all local institutions within the regulatory jurisdictions of the two authorities are prohibited from promoting crypto-related businesses or ideas.
“Here, We solemnly warn relevant institutions within our jurisdictions no to provide business premises, commercial display, marketing, and paid diversion services for virtual currency-related business activities.”
Financial institutions are also barred from directly or indirectly providing such services to their customers.
To consumers, the statement affirmed that they should not under any circumstance engage in crypto trading activities but instead practice vigilance in their investment choices and enhance their risk awareness.
“Do not participate in virtual currency trading activities, do not blindly follow the trend of virtual currency-related speculation, and beware of personal and rights damage.”
Additionally, in order to prevent illegal use and leakage of personal information, the regulators have prohibited customers from using their personal bank accounts for any crypto-related transactions.
“Promptly report clues about violations of laws and regulations related to virtual currency transactions, and report to the public security organs in time for suspected crimes.”
The People’s Bank of China is extending its crypto hostility to local businesses, after permanently shutting down the Bitcoin mining industry in the last month. In late June, Commercial banks in China were also directed to cut off Yuan deposits to OTC cryptocurrency trading desks.
This high level of commitment to drive cryptocurrency out of its second-biggest customer base after North America is happening in parallel to China’s increased testing of its PBoC Digital Yuan.
The most recent development on its integration has revealed that DCEP (e-CNY) can be programmed to confine utility. The second giveaway announcement on Monday by the Chengdu government said that 12 million e-CNY ($1.8 million) will be awarded in a lottery to 100,000 residents who can only use the money to pay for public transportation.
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