The Chinese authorities have drawn a bamboo curtain over cryptocurrency exchanges and traders in the country.
The central bank – the People’s Bank of China – has declared victory in a fight to stop initial coin offerings (ICOs) and digital currency trading.
Beijing’s long-term goal is to replace the free digital currency market with a state-owned cryptocurrency and blockchain controlled by the central bank.
Because of the policy to ban cryptocurrency, any state offering of digital currency has no local opposition.
“The development of digital economy needs central bank-issued electronic currency more than ever. It’s crucial to speed up the research and issuance,”said a spokesman for the central bank last year.
Blanket ban on digital currencies
The bank says the blanket ban on all cryptocurrency activity was a bid to stamp out rogue traders and fraudsters charging investors exorbitant fees and rates of interest while deceiving them to invest in ICOs that were just fronts for stealing their money.
Prior to September 2017, China was the world’s major cryptocurrency centre, with around three-quarters of all transactions taking place in or passing through the country.
Then the government decided to boot out the crooks with a blanket ban on all cryptocurrency activity.
Six months later, the central bank says the operation is complete and all traders and exchanges in the country have closed.
“There is only one thing that we should do now, and that is stand by and watch as bitcoin’s corpse floats past us,” said central bank vice president, Gongsheng Pan.
India blocks taking money from e-wallets
Meanwhile, a similar policy move has taken place in India, where the Reserve Bank of India has banned the nation’s banks for, transferring money between cryptocurrency wallets and their bank accounts.
The move effectively stops investors from accessing their money in India as rupees and curbs any digital currency start-up from raising money through an ICO.
Indian authorities have already banned ICO social media advertising in another move to shut down the market and close digital currency exchanges.
Other countries are heading down the same route – with Australia launching exchange regulations and South Korea trialling a national cryptocurrency.
The choke-hold is also easing in Russia and Thailand, where ripple is talking with the governments about developing state cryptocurrencies.