Cryptocurrency Exchanges Hurriedly Cut Ties With Chinese Users Following Fresh Crackdown

Cryptocurrency exchanges, as well as providers of crypto services, are hurrying to cut business ties with mainland Chinese clients following Beijing’s blanket ban on all crypto trading and mining last Friday.

On Friday, ten powerful Chinese government bodies, including the central bank, announced that overseas exchanges were banned from providing services to mainland investors online. This had previously been a grey area. 

Binance and Huobi Global, two of the globe’s largest crypto exchanges that are especially popular with Chinese customers, have stopped new registrations of accounts by users in the country. Huobi has also promised to clean up existing Chinese customers by the end of 2021. Speaking to Reuters, Huobi co-founder Du Jun said: “On the very day we saw the notice, we started to take corrective measures.” 

On Monday, shares in crypto-related firms fell with investment holdings company Huobi Technology plunging 23% and fintech company OKG Technology dropping 12%.

In an announcement to clients, TokenPocket, a popular service provider of crypto wallets, said it would be terminating services to mainland Chinese customers to avoid violating Chinese policies. The provider said it would actively embrace the new regulations and said it welcomes cooperation from China in blockchain tech. 

In 2017, many Chinese crypto exchanges closed down or relocated offshore as China banned such platforms from converting legal tender into cryptocurrencies and vice versa. In May of this year, China’s state council announced plans to ban bitcoin trading and mining altogether, despite China once being the largest bitcoin trading and mining centre in the world. 

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