China’s crypto fans find ways to trade using tether and VPNs

Chinese crypto enthusiasts are evading Beijing’s ban on cryptocurrency exchanges using so-called virtual private networks (VPNs), according to domestic daily the South China Morning Post.

China’s cryptocurrency enthusiasts are finding ways to trade despite ban

The paper said traders had begun leveraging tether, the dollar-backed stablecoin to enter and exit cryptocurrency markets enabled by a VPN – a secure system that runs across a public network such as the internet, enjoying similar security and functionality as a private network.

Overseas exchanges

Armed with a VPN cryptocurrency trading counterparties can use an exchange outside of China – where such trading platforms are banned – as an intermediary to exchange digital currencies for fiat currencies and vice versa.

The South China Morning Post report says that two individuals who have completed a know-your-customer procedure with an exchange would swap fiat for tether.

It continues: “The exchange plays the role of an overseer of such trades, and stands ready to adjudicate in cases of failed trades, or transactions that are not honoured.”

So – despite the blanket ban on cryptocurrency exchanges – China’s cryptocurrency devotees have found a way to trade and there is currently no scheme in place to successfully block access to VPNs and other online resources.