Institutions are Prohibited from Conducting Crypto Transactions in China

According to a Chinese journalist who covers the crypto and blockchain industries, a recent guideline from three leading Chinese institutions prohibits cryptocurrency transactions in their businesses – for pricing, trading, and so on.

Chinese Institutions To Prohibit Conducting Cryptocurrency Transactions

Colin Wu announced in a tweet that three major Chinese organizations affiliated with the People’s Bank of China (the PBOC) have strongly advised Chinese institutions to prohibit cryptocurrency transactions in their business operations.

Breaking: Three associations under the Central Bank of China issued a document requiring institutions not to conduct virtualcurrency business, calling on the public not to participate in virtualcurrency, and emphasizing that virtualcurrency transactions are not protected by law.

— Wu Blockchain (@WuBlockchain) May 18, 2021

“Because of the popularity of altcoins, more new investors have emerged in China recently, attracting the attention of regulators. However, the association issued this note, indicating that it has not yet received a higher degree of attention from Chinese authorities.”

The National Internet Finance Association of China (NIFA), the China Banking Association (CBA), and the China Payment and Settlement Association all issued mandatory recommendations.

Colin Wu warns readers that cryptocurrencies are not real currencies since they are not provided by a financial authority and can not be used as a daily means of payment in the marketplace. Also, cryptocurrencies are not legally secured, and that if a user suffers a financial loss as a result of crypto assets, the burden will be solely theirs.

Financial, payment, and other forms of entities have been strongly advised not to engage in any business practices involving cryptocurrencies (Bitcoin, Ethereum, and so on) such as trading speculation, pricing products, and services in crypto, issuing shares, selling tokens, and so on.

The Digital Yuan Is Being Tested In China.

China has been developing its own centralized digital currency, issued by the Central Bank, for many years. Initially known as DCEP (digital currency electronic payment), it is now widely recognized as a digital variant of the yuan.

When Facebook announced its intention to launch the Libra stablecoin in 2019, it sparked the growth. However, regulators and central banks around the world opposed the project.

It has now been relaunched as Diem. Meanwhile, Chinese authorities have been conducting one digital yuan trial after another in various parts of the country and through major corporations and banks.