The People’s Bank of China bans Bitcoin again

The People’s Bank of China posted a September 15 memo on its website addressing the country’s Bitcoin ban, which resulted in widespread Bitcoin sales and a price drop on Friday morning.

The People’s Bank of China (PBOC) posted a September 15 memo on its website addressing the country’s Bitcoin ban, which resulted in widespread Bitcoin sales and a fall in prices on Friday morning.

The memo outlines a nationwide crackdown on Bitcoin and other cryptocurrencies out of concern that they “disrupt the economic and financial order, seriously endanger illegal and criminal activities such as gambling, illegal fundraising, fraud, pyramid schemes and money laundering”. the security of people’s property. ”

The People’s Bank of China has once again urged prominent financial institutions in China to reinforce a developing nationwide ban on Bitcoin exchanges and transactions. The institutions have been asked to help the central bank prevent Chinese citizens from trading Bitcoin through domestic and international exchanges and over-the-counter platforms.

The memo called on all relevant Chinese central government agencies to work together to:

1. Clarify the key attributes of the virtual currency and related business activities.

2. Establishment and improvement of a working mechanism to deal with the risks of trading virtual currencies.

3. Strengthening of risk monitoring and early warning of speculation in virtual currency trading.

4. Build a multi-dimensional, multi-level risk prevention and disposal system.

The memo emphasized that Bitcoin “is not legal and should not and should not be used as a currency in the market or circulated” and detailed the extent to which “virtual currency-related business activities are illegal financial activities”.

The PBOC describes how cross-departmental efforts are required to shut down the exchanges and ramps for bitcoin and other cryptocurrencies and punish suspicious parties involved in the distribution of bitcoin or crypto-securities in order to avoid “the economic and financial order and maintain social peace and stability. “The language of the memo sometimes slips from stately and bureaucratic into an idealized utopian vision.

Perhaps most frightening for bitcoiners is the PBOC’s public vow to extensively monitor citizens, both online and offline, to “improve the accuracy and efficiency of identifying and detecting hype surrounding virtual currency transactions.” The statement continues to claim that it has advanced technology for comprehensive real-time tracking of blockchain transactions and information on newly mined coins, their transactions and exchanges.

The PBOC also makes clear its intention to react quickly to perceived violations with its “rapid reaction mechanisms” by ordering residents and institutions to whistle at suspected violators.

“According to the information provided by the tax authorities, the authorities responsible for network information and telecommunications will immediately switch off Internet applications such as websites, mobile applications and small programs that carry out currency-related business activities in accordance with the law.”

The PBOC goes so far as to ban the commercial and even private use of words or content in connection with Bitcoin and cryptocurrencies, with the surveillance of the language of course being the hallmark of an authoritarian state regime.

The memo advocates that all government agencies implement swift and strong internal self-disciplinary action against member units that commit bitcoin or cryptocurrency violations.

The general message from the PBOC is that the state will continue to act with renewed urgency, “high pressure” on Bitcoin, and dynamically monitor a currency that it believes poses a major risk to the population.

China’s interest in the Bitcoin ban is nothing new. The communist country’s ability to remove access to popular Bitcoin entrances and exits could be amplified, but it is impossible for them to completely stop peer-to-peer transactions.

Overall, China’s renewed Bitcoin ban betrays its utter inability to stop it.

It is noteworthy that the price of Bitcoin has increased by $ 40,000 since the first China ban. The country’s efforts to ban bitcoin mining last summer, thereby damaging the network, resulted in a global hashrate redistribution and renewed interest in bitcoin mining across the board as the lower network hashrate made it possible for new businesses to start mining at a lower cost.

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.

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