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China declares Crypto transactions Illegal, gives reasons

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digital currencies in China

China’s central bank has described all financial transactions involving cryptocurrencies as illegal, sounding the death knell for digital currencies in China after a crackdown on the volatile trade.

Recall that the global values of cryptocurrencies including Bitcoin have been unstable over the past year due to Chinese regulations, which have sought to prevent speculation and money laundering.

The People’s Bank of China (PBOC) in an online statement Friday said, “virtual currency-related business activities are illegal financial activities,” offenders would be “investigated for criminal liability in accordance with the law.”

China’s placement of ban on all related financial activities involving cryptocurrencies includes trading crypto, selling tokens, transactions involving virtual currency derivatives, and “illegal fundraising”.

China’s central bank disclosed that in recent years the “trading and speculation of Bitcoin and other virtual currencies have become widespread, disrupting economic and financial order, giving rise to money laundering, illegal fund-raising, fraud, pyramid schemes and other illegal and criminal activities.”

It was learnt that Chinese officials recently noted that more than 1,000 people had been arrested for using the profits from crime to buy cryptocurrencies.

This medium gathered that many Chinese provinces have already banned the operation of cryptocurrency mines since the start of this year, with one region accounting for eight percent of the computing power needed to run the global blockchain — a set of online ledgers to record bitcoin transactions.

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