China to block crypto trading from overseas exchanges

August 23, 2018
Chris Wheal

Chinese financial regulators are seeking to block more than 100 foreign cryptocurrency exchanges from offering trading services to investors in China.

China seeks to ban overseas crypto exchanges from offering services in China

Reported in the Shanghai Securities Times, a media arm of China’s regulatory authorities, the China National Fintech Risk Rectification Office has identified 124 trading venues with foreign IP addresses that are able to offer services in China.

Blanket ban

China first issued a blanket ban on all initial coin offering (ICO) activity in September 2017, subsequently extending the ban to shut down all domestic cryptocurrency trade.

Prior to the ban, which was largely enacted in January after bitcoin hit its near $20,000 record high, China’s enthusiasm for bitcoin accounted for the majority of global cryptocurrency trade.

Indeed, research from the National Internet Financial Risk Rehabilitation Team showed that Chinese citizens had continued to participate in digital currency trading using overseas exchanges and ICO platforms, despite the ban.

Next steps

Pan Gongsheng, head of the Risk Rehabilitation Team, said: “Speculation related to virtual currency has prevailed, prices have skyrocketed, and risks have gathered rapidly, seriously disrupting economic, financial and social order.

“The main body of ICO financing is mixed, and the financing operation is suspected of illegally issuing securities, illegal fund-raising, financial fraud, pyramid schemes and other illegal and criminal activities.”

Following the identification of the 124 overseas trading sites, the Team said the next steps would be to strengthen monitoring in real time, dispose of new ICO and cryptocurrency transaction-related websites, and stop providing payment and settlement services for suspicious transactions.

Post written by Chris Wheal
Chris Wheal is editor of OpenLedger's news and features service. An award-wining business journalists himself, he runs a team of freelance journalists from across the UK and north America.

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