China’s Central Bank Shuts Down 11 companies Suspected of Crypto Trading

China’s Central Bank Shuts Down 11 companies Suspected of Crypto Trading

Shenzhen Center Branch of People’s Bank of China, the Chinese Central Bank has announced the closure of 11 companies suspected of being involved in virtual currency trading. The Shenzhen province of the central bank issued a notification for the rectification and clean-up of the 11 companies involved.

The Shenzhen branch of the Central Bank of China recently launched a special crackdown on illegal cryptocurrency trading activities and shut down 11 companies suspected of conducting illegal virtual currency activities.— Wu Blockchain (@WuBlockchain) August 17, 2021

The local reports suggested that the Shenzhen branch of the Chinese Central Bank had prepared a list of 46 companies suspected of being involved in illegal virtual currency trading by the end of July. The Shenzhen branch’s special task force was created to identify and rectify companies found to be involved in illegal virtual currency trade. The branch has completed the rectification of a well-known domestic financial website that violated foreign exchange deposit trading. The official notification read,

“Carry out special rectification of illegal virtual currency trading activities, and promptly clean up and rectify 11 newly emerging companies suspected of carrying out illegal virtual currency activities. Completed the rectification of a well-known domestic financial website that was suspected of propagating violations of foreign exchange deposit trading, and properly handled 8 reports of illegal and criminal activities related to online foreign exchange and cross-border stock trading.”

The Chinese Central Bank in a recent conference has mentioned it would continue its crackdown on digital assets in the second half of the year as well.

China to Continue Crackdown on Cryptocurrencies

China started strict crypto crackdown policies in May beginning with Bitcoin mining eradication. At that time China accounted for more than 60% of Bitcoin mining hash power as the majority of mining farms operated out of the country. The Central Bank cited environmental concerns as Carbon emissions goals to be the reason behind the crackdown. The authorities extended their crypto crackdown on digital asset trading and started banning companies found to be involved in it.

The Chinese crackdown is nothing new and no bull market is complete without one. In 2017, the country banned all crypto exchanges in the country, while in 2013 it has banned the use of cryptocurrencies altogether. The Chinese crackdown is often followed by the second leg of the bull run, which historically has proven to be more significant than the first one.

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