Friday 24 September 2021
China bans cryptocurrency
The Chinese leadership is cracking down on cryptocurrencies, and their trading in the country has been banned since 2019. Beijing is now taking another step forward: anyone dealing in cryptocurrency will be liable to prosecution. Soon after the announcement, Bitcoin will lose its value.
China’s central bank has declared that all financial transactions involving cryptocurrency are illegal. The central bank said that cryptocurrency-related businesses are “illegal financial activities” and the alleged suspects should expect criminal investigations. With their decision, it is prohibited not only to trade in digital currency, but also to sell digital assets and transactions in crypto-derivatives.
The Chinese leadership has been cracking down on crypto for a long time and has been warning about it time and time again. By this you want to set an example against speculation and money laundering. It is also for this reason that the value of global cryptocurrencies, including Bitcoin, has fluctuated sharply over and over again. Immediately after the announcement from Beijing, the most popular cryptocurrency lost its value and collapsed by more than six percent. The digital currency Ethereum also lost significantly in value by 10.7%.
China’s central bank said that trading in bitcoin and other cryptocurrencies in the past few years “destroyed the economic and financial system” and “favored money laundering, illegal capital raising, fraud and other criminal activities.” To threaten the security of citizens’ property. Pure trading and “production” of cryptocurrency has been banned in China since 2019.
Cryptocurrencies were invented as a means of payment that operates independently of central banks, so they are difficult to regulate. Skeptics warn about the high volatility of cryptocurrencies – so they are more often used as a subject for speculation and investment than as a means of payment, which can lead to significant losses. In addition, amazing hacker attacks on cryptocurrency platforms have been making headlines lately.
China is working on its own internet currency. With the indication from Friday, the government is now paving the way for a cryptocurrency under tight leadership control.
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