Why governments across the world are scared of Cryptocurrencies? and they think bitcoin is a boogeyman.
The Chinese government banned all crypto transactions and plans to root out all mining of digital assets, delivering the toughest blow yet to the industry.
Crypto-related transactions will be considered illicit financial activity, including services provided by off-shore exchanges, the People’s Bank of China said on its website. It added that cryptocurrencies, including Bitcoin and Tether, are not fiat currency and cannot be circulated.
Chinese officials are going further to stamp out crypto trading for its ties to fraud, money laundering and excessive energy usage. China already has rules that bar banks from offering crypto-related services. To get around such rules, traders have moved to over-the-counter platforms and offshore exchanges.
“China’s ban on all cryptocurrency trading activity will have some short-term impact on the currency’s valuation, but long-term implications are likely to be muted,” said Ganesh Viswanath Natraj, an assistant professor of finance at Warwick Business School.
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