China Intensifies Crackdown on Crypto Mining and Bans Trading

The National Development and Reform Commission of China has released on Friday a notice about its intensified crackdown on crypto mining. In addition, China’s central bank - People’s Bank of China, announced that financial institutions and non-bank payment providers were banned from offering services to crypto-related activities.

The actions against crypto industry were due to China’s concern that the volatility of digital currencies could disrupt its economic market. Besides, the Commission highlighted that crypto mining was an energy-intensive activity, which would pose a threat to the country’s environmental goal of achieving carbon neutrality. It will cut off financial support and electricity supply for mining.

For the purpose of protecting its citizens’ interests, and guarding against illicit activities like money laundering, gambling and scamming, etc., China will establish a mechanism for early warning and stopping “hype” in crypto trading and mining activities. The major authorities including the Supreme People’s Court of China, the Supreme People’s Procuratorate of China, Ministry of Industry and Information Technology of China, the Ministry of Public Security and State Administration and Market Regulation and others will collaborate with each other to implement the strategy.

This year, China has taken a series of measures to attack crypto market. In May, Chinese mainland has stepped up efforts to hit Bitcoin mining trading to fend off financial risks. As a result, Huobi, originated in China, was forced to suspend its miner hosting services in the region and now is based overseas. Moreover, the move sent the shares Bitcoin tumbling 30% in a day. Successively, Bitmain​ ceased the sales of machines for global delivery.

In June, the central bank ordered​ some financial institutions and payment providers to stop dealing with cryptocurrency transactions, and to cut off funding channels for crypto OTC merchants if found.