China Escalates Crackdown on Cryptocurrency Trading

Updated on
  • Focus on exchange-like platforms follows uptick in activity
  • Regulators around the world are scrutinizing cryptocurrencies
Why China Is Cracking Down on Cryptocurrencies

China is escalating its clampdown on cryptocurrency trading, targeting online platforms and mobile apps that offer exchange-like services, according to people familiar with the matter.

While authorities banned cryptocurrency exchanges last year, they’ve recently noted an uptick in activity on alternative venues. The government plans to block domestic access to homegrown and offshore platforms that enable centralized trading, the people said, without being more specific about how policy makers define such platforms.

Authorities will also target individuals and companies that provide market-making, settlement and clearing services for centralized trading, the people said, asking not to be named because the information is private. Small peer-to-peer transactions aren’t being targeted, they said.

Bitcoin fell 1.2 percent to $13,580.50 at 11:36 a.m. in London, according to Bloomberg composite pricing.

The Chinese government’s rolling clampdown has roiled global markets for bitcoin and other digital tokens over the past few months. Regulators around the world are stepping up scrutiny of cryptocurrencies amid concerns over excessive speculation, money laundering and tax evasion.

Read more: A QuickTake Q&A on the Chinese clampdown

Up until early last year, China was the most active market for bitcoin trading on exchanges. It’s still home to some of the biggest bitcoin miners, though they’ve begun looking elsewhere as local authorities call for curbs on the industry.

China’s central bank didn’t immediately respond to a faxed request for comment.

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— With assistance by Steven Yang

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