The crypto community in China is facing serious issues as the People’s Bank of China (PBoC) flags the accounts of crypto traders. The press release was made by a local crypto news outlet, WuBlockchain, stating that the nation’s bank might suspend the accounts of individuals who indulge in crypto-based transactions. The move is a result of the underlying cases of money laundering in China.
The People’s Bank of China plans to tackle illegal transactions
Earlier this year, the People’s Bank of China launched programs to eradicate illegal earning. While collaborating with other local banks, they will examine transactional details of account holders to prevent the spread of illicit funds, which cryptocurrency is part of in China.
Major recipients of this backlash are China’s over-the-counter (OTC) crypto dealers and firms that engage in trades outside the public market (such as crypto exchanges) with millions of dollars. Meanwhile, some crypto OTC accounts are already in the blacklist. The People’s Bank of China will further monitor all accounts in the blacklist. And account holders will also refrain from using bank-issued cards for the next three years. The nation’s bank will also ban them from conducting any form of online transactions in the next five years. These rules apply to all accounts in the blacklist and other cryptocurrency accounts.
Furthermore, all details about the accounts in the blacklist will be sent across all local Chinese banks, and then to a regional branch of the People’s Bank of China. Hence, preventing over-the-counter dealers from opening new accounts in other locations within the country.
Lack of laws affecting business
The report also disclosed that many crypto over-the-counter dealers had to shut down their business in fear of the consequences. However, a few industry observers assert that the blacklisting will not affect simple cryptocurrency sales. And only those involving black money and illegal assets will be affected.
Away from the reports, the crackdown on cryptocurrencies does not affect the development of the state-backed digital currencies. The country is still pushing to launch its digital currency and is already testing the digital Yuan in rural areas. However, public cryptocurrencies like Bitcoin are still on strict restrictions, or maybe that is part of its plan.