China’s central bank continued pressure on companies linked to crypto-assets

August 23, 2021

China's central bank continued pressure on companies linked to crypto-assets

The Shenzhen branch of the People's Bank of China (PBOC) has begun inspecting entities suspected of engaging in illegal digital asset transactions. The regulator has "swiftly cleaned up and made adjustments" in the operations of 11 companies, Shanghai Securities Journal reported, citing the NBK.

"The NBK has now completed the business adjustment of a prominent financial website suspected of facilitating illegal currency deposit transactions. The regulator has also duly processed eight reports of illegal and criminal activities related to online forex market and cross-border share trading," the report said.

Chinese regulators often use the wording "made adjustments" to denote an intervention to ensure that a company's operations comply with applicable law.

Similar terminology, for example, was used in the prosecution of fintech company Ant Group (a subsidiary of Alibaba Group) in 2020. To continue operations, it had to restructure the business into a financial holding company. The actions of the authorities derailed an IPO in which Ant had hoped to raise around $34bn.

Earlier, the NBK announced plans to continue putting pressure on the cryptocurrency trading industry. The Chinese Central Bank intends to strengthen regulation of Internet financial platforms and crack down on illegal digital asset transactions.

In May, Vice Premier Liu He told a meeting of the Financial Stability and Development Committee of China's State Council that measures were being prepared to deal with mining and bitcoin trading.

In June, the NBK held a meeting with representatives of financial institutions and banned them from participating in cryptocurrency transactions.

In July, NBK Vice Chairman Fan Yifei called bitcoin and staplecoin speculative instruments that threaten financial system security and social stability.

Recall that in August, Chinese authorities announced continued regulatory pressure on technology companies.

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About the author

Hi there, my name is Zalman Weinberg. I'm enthusiast with over 7 years of experience in cryptocurrencies and blockchain. Professional Trader providing Blockchain solutions to Startups and Enterprises. Expert in all cryptocurrency exchange APIs (BitMEX, Bittrex, Binance, Bitfinex, Kraken, Poloniex, Gdax etc.). I have also worked with multiple Forex broker APIs.

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