Saturday, May 21, 2022

PBoC’s Shenzhen Province Shuts 11 Crypto Trading Companies

Shenzhen Center Branch of People’s Bank of China has shut 11 companies in speculation of being involved in crypto trading. A notification has been released by the Shenzen province of China’s central bank, for rectifying and cleaning up of 11 companies involved. 

According to the local reports, the Shenzen province prepared a list, in which it added 46 companies that were suspected to be involved in illegal crypto trading activity by the end of July. In order to identify and rectify these companies, Shenzhen formed a special task force. It has rectified a well-known domestic financial website for violating foreign exchange deposit trading.

The province has released a notification, stating, “Carry out special rectification of illegal virtual currency trading activities, and promptly clean up and rectify 11 newly emerging companies suspected of carrying out illegal virtual currency activities. Completed the rectification of a well-known domestic financial website that was suspected of propagating violations of foreign exchange deposit trading, and properly handled 8 reports of illegal and criminal activities related to online foreign exchange and cross-border stock trading.”

China Continues Crypto-Crackdown

Recently, while making an announcement, the central bank of China informed that it will be continuing the crackdown on cryptocurrencies in the second half of the year as well.

In May 2021, the country initiated a strict crackdown policy on cryptocurrencies by banning Bitcoin mining activities. At that time, China was responsible for over 60 percent of Bitcoin mining hash power around the world because the majority of the mining farms were being operated out of the country. While citing the environmental issue concern, PBoC imposed a ban on mining activities. Following this, the authorities decided to extend their crackdown policy, therefore, they imposed the ban on crypto trading and later, the companies involved in crypto-related activities were shut. 

Notably, this is not the first time China imposed a ban on crypto-related activities in the country, in fact, it is being believed that without China’s crackdown, the bull market is never complete.

In 2013, China banned the use of cryptocurrencies altogether in the country, then in 2017, it banned all the crypto exchanges. 

China’s crackdown on the crypto industry is mostly followed by the second leg of the bull run, which has proven to be more significant than the first one.

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