The Chinese government has announced further details relating to its ban on cryptocurrencies.
The Chinese government has released more details about its cryptocurrency ban.
“Recently, virtual currency trading hype activities have risen, disrupting economic and financial order, breeding illegal and criminal activities such as gambling, illegal fundraising, fraud, pyramid schemes, and money laundering,” the government said.
To prevent these risks from further materializing, the government has today published a notice that clarifies its stance on crypto.
The notice clarifies that virtual currencies do not have the same legal status as legal currency in China. It also reiterates what has been in place for years, namely, that cryptocurrency trading is against the law.
“Virtual currency-related business activities are illegal financial activities,” the government’s notice reads.
The notice also calls for the strengthening of risk monitoring and early warning of virtual currency trading.
This newly released information has already taken its toll on the crypto markets. Bitcoin—the industry’s flagship cryptocurrency—has dropped by almost 4% in the last hour, and Ethereum is down 3.3% in the same time frame.
Elsewhere, the Huobi token (HT) is down over 15% in the last. Huobi is a crypto exchange founded in China, with offices across Asia.
China’s tumultuous relationship with crypto
This year has been a testing year for the Chinese crypto industry.
Starting as early as February, China clamped down on crypto mining, with miners across provinces like Inner Mongolia and Xinjiang told to shut up shop.
In May, a group of three payments and financial associations then reiterated the central bank’s ban on firms engaging with cryptocurrencies.
The National Internet Finance Association of China, the China Banking Association, and the Payment and Clearing Association of China also warned that cryptocurrency trading was a “speculative” activity.
While crypto mining has come under specific fire for most of this year, China’s efforts to ban crypto trading began as far back as 2017.