Every one might be very well familiar with the cryptocurrency ban which has been done in China. It is no surprise to anyone living in the cryptocurrency space that China is about to ban all the cryptocurrencies on the border of its country. However, China was about to be on the cryptocurrencies because of the hostile relationship with the crypto industry. It was earlier stated that China is not favouring cryptocurrency evolving. The carbon emissions of cryptocurrencies are very high, and the mining operations are seriously undermining the country’s financial system. Apart from this, there are several other significant reasons specified by the country of China for the ban they have imposed on the trading and mining of cryptocurrencies. The rules and regulations on the use of cryptocurrencies and their creation have been going on in China since 2013 and therefore are not new to anyone.
However, if anyone in the cryptocurrency space believes that it is the final nail on the coffin of crypto from China, perhaps this is a wrong assumption. A few years back, China was about to launch rules and regulations on cryptocurrencies and proposed bringing about its crypto coin. Therefore, we can never be sure if China will ban crypto coins entirely or are just moving towards launching their own. It is uncertain, and hence, we are in a situation where we can wait and watch what China is planning on.
2013 war on Crypto transactions
In 2013, China first waged war against cryptocurrencies by warning people that cryptocurrencies would head to the financial system. On December 5, 2023, the People’s Bank of China said that banks cannot facilitate any transactions related to cryptocurrencies like bitcoin. According to the statement given by the officials of China, virtual currencies are just a commodity, and they also lack any legal regulations from the government. The main reason the ban was imposed on bitcoin was that no nation is backing cryptocurrencies. Also, these are the outlets that can be facilitated to launder cash. If you are interested in bitcoin trading check if you should be investing in stablecoins.
ICO ban in 2017
To suppress any illicit flow of money outside the boundaries of China, the central bank of the country investigated the activities which involve cryptocurrencies. The section came up in January 2017, and the investigation focused on cryptocurrency exchanges dealing in forex management and anti-money laundering. Also, it is essential to know that China imposed a complete ban on the initial coin offerings on September 4, 2017. These ICOs were one of the most critical components because the business organisation mainly used them for initial raising funds. Business organisations can raise funds by selling these tokens by creating them themselves and launching them in the market.
2019 – BTC mining
In 2019, the country’s national development and reform commission said that bitcoin mining is an entirely desirable activity under the industry of sector that should be encouraged. Also, the cryptocurrency mining operations need to be wholly restricted or face out of the local governments. Therefore, they consider bitcoin mining to be a complete computer incentive process and also considered to be significantly polluting for the environment.
The industry problem of China began in 2021, and in May, the country altogether banned cryptocurrency mining and trading operations. According to the reports, these were because those cryptocurrencies can undermine the country’s financial system. According to the statement given by the state council, anyone who is going to take up cryptocurrency mining activities will get a large amount of energy supply, but that also at a very high rate. It will lower the profit that any cryptocurrency mining firm can make, and hence, the mining operations work up-down. There were massive rules and regulations, and penalties imposed on the people engaged in any cryptocurrency mining operations. Apart from this, they also impose massive penalties on the people involved in cryptocurrency trading activities, majorly BTC. It led to a complete shut down of cryptocurrency mining as well as trading activities in the borders of China.