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Saturday, Jul 31, 2021

Market Falls As China Enforces Banks To Block Crypto Transactions

Market Falls As China Enforces Banks To Block Crypto Transactions

Central Bank of China told institutions not provide trading, clearing and settlement for any crypto transactions, amid the enforcement of the latest ban on crypto in the country.

The People’s Bank of China on Monday said to the country’s major financial institutions to stop facilitating virtual-currency transactions, increasing the negative sentiment in crypto markets.

Banks and other financial institutions are not allowed to provide products or services such as trading, clearing and settlement for crypto transactions, the PBOC said in a statement.

The financial institutions also have to make sure to identify virtual-currency exchanges’ and over-the-counter dealers’ capital accounts, and cut off the payment link for transaction funds in a timely manner, the central bank’s statement said.

Cryptocurrency market fell in the aftermath. Bitcoin was trading near $32,000 and ether dropping below $2,000 for the first time since May 23.

While the China’s anti-crypto agenda is not new, the latest statement comes after consultation with the Industrial and Commercial Bank of China, Agricultural Bank of China, Construction Bank, Postal Savings Bank, Industrial Bank and Alipay (China) Network Technology on the issue.

The central bank has blamed the hype surrounding virtual-currency transactions, and identified them as a risk for illegal cross-border transactions and money laundering and a challenge to economic and financial order.

Financial institutions and banks in the country have agreed to take necessary steps in line with the PBOC’s guidelines, the statement highlighted.

The Postal Savings Bank issued a statement saying it will take steps to prohibit virtual currency-related business activities.

According to journalist Colin Wu, payments platform Alipay and the Agricultural Bank of China also issued similar statements.

The PBOC’s crypto ban enforcement comes in the aftermath of the Chinese government’s crackdown on crypto mining activities in the Sichuan province, the world’s largest hydro-powered bitcoin mining area.

China rocked the crypto markets last month, reiterating the long-held ban on cryptocurrency trading and mining.

Source: Market Falls As China Enforces Banks To Block Crypto Transactions – Fintechs.fi

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