China bars financial payment institutions from using cryptocurrency China has prohibited the provision of crypto-currency services to financial institutions and payments companies, and warned investors of speculative crypto-trading
China has banned the provision of cryptocurrency services by financial institutions and payment undertakings and warned investor against speculate crypto-trading.
It was China’s most recent attempt to tackle an emerging market for digital commerce. Three industry bodies said in a joint statement that these institutions, including banks and online payment channels should not offer any cryptocurrency service to customers, such as registration, trade, clean-up and settlement.
China bars financial payment institutions from using cryptocurrency
“Crystal prices have just fallen and collapsed, and speculative crypto-currency trading has rebounded, in serious violation of the security of people’s property and disrupting ordinary economic and financial order,” the statements stated.
China banned the exchange of crypt and original coins, but it did not prevent the use of cryptocurrencies by individuals.
Institutions should neither provide cryptocurrency saving, trust or pledging services nor issue crypto-monetary financial products.
In June 2019, the People’s Bank of China issued a statement saying it would block access to all domestic and foreign cryptocurrency exchanges and Initial Coin Offering websites, aiming to clamp down on all cryptocurrency trading with a ban on foreign exchanges.
The statement also highlighted the risks of cryptocurrency trading, saying virtual currencies “are not supported by real value”, their prices are easily manipulated, and trading contracts are not protected by Chinese law.