China is Suppressing Cryptocurrency, and Other Countries Are Paying Attention

Bitcoin, the most popular cryptocurrency in the world, will become legal tender in El Salvador in September 2020, heralding the beginning of a new era for the crypto-technology industry. Happiness, on the other hand, was a fleeting experience. Later that month, following the implementation of top-down measures across the Pacific, ripples were sent through the cryptographic system to be received.

China’s authorities issued two notices on September 24th, both of which were related to the cryptocurrency industry.

As stated in a document published on the NDRC’s website, the ultimate goal is for cryptocurrency mining-related upstream and downstream activities to be eliminated. According to the concept of ecological civilisation outlined in Xi Jinping’s Thought on Socialism with Chinese Characteristics for a New Era, cryptocurrency makes a small contribution to China’s national economy, despite the fact that it consumes a significant amount of energy. 

It proposed central coordination, provincial responsibility, and implementation at the city and county levels in order to combat any mining activity that may occur. As a result, there is no possibility of receiving financial assistance from local government units, banks, or other financial institutions.

It required all financial institutions, including banks and non-bank payment processors, to recover loans that had already been made under the terms of the agreement.

 Not only should existing mining projects be accelerated, but also the preliminary work on cryptocurrency mining projects in general, particularly through the monitoring and analysis of unusual electricity consumption, should be accelerated. There has been a request to differentiate mining from other industries such as blockchain, big data, cloud computing, and so on. There has also been a request to strengthen credit supervision for data centre companies in general.

Another notice was directed specifically at cryptocurrency traders. According to the Chinese government, cryptocurrency is not considered legal tender in the country. Thus, cryptocurrency-related business activities are prohibited in China, including cryptocurrency exchanges that are located outside of China but provide services to Chinese citizens through the internet.

 Local monitoring and early warning mechanisms, as well as the combination of online monitoring and offline investigation, are being urged to be improved in order to improve the accuracy and efficiency of identifying hyped cryptocurrency activities, the organisation has demanded of provincial governments.

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