In recent weeks, following the China’s promotion of Blockchain technology, there has been a notable increase in interest towards cryptocurrency price speculation. This seems to have put Chinese financial regulators into attack mode, targeting cryptocurrency exchanges that operate in the region.
In this interesting twist of fate, the People’s Bank of China (PBoC) released an official statement detailing its planned crackdown on digital assets trading within the countries boarders.
“There are multiple risks in virtual currency issuance financing and trading, including false asset risk, business failure risk, investment speculation risk, etc. Investors should enhance their risk prevention awareness and beware of being fooled. Being cheated,” the regulatory body said.
As part of its planned move to snuff out the aforementioned risks, the two cities of Shanghai and Shenzhen have already started carrying out raids on cryptocurrency trading operations in the two locations. These raids form part of the country’s plan to “adopt monitoring measures such as interviews, inspections, and bans on the monitored entities involved in virtual currency activities to resolve related risks in a timely manner.” As per official statement.
39 Exchanges Red Flagged in Shenzhen
Following the crypto crackdown in Shanghai, the city of Shenzhen is reported to have identified at least 39 digital assets trading platforms that have failed to comply with China’s ban on cryptocurrency price speculation. Though the names of the 39 exchanges marked for inspection are yet to be released, the authorities are expected to have all inspections completed by the end of business day on the 25th of November.
Apart from the complete closing of business operations, there has been no clear indication of what legal ramifications will befall companies that have run afoul of China’s trading ban. According to Changpeng Zhao, fonder of Binance, “This is actually a very good thing to happen, cleaning up the industry of scammers and fraudsters,” as he tweeted.
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