The Vice Governor of the People’s Bank of China (PBoC), Pan Gongsheng, had harsh words for foreign initial coin offerings (ICOs) that are targeting Chinese investors.
He said, At a meeting for the Internet Finance Rectification Working Group on 9th July 2018,
“Any new financial product or phenomenon that is not authorized under the existing legal framework, we will crush them as soon as they dare to surface.”
ICOs and Trading Cryptocurrency has been banned in China for Chinese yuan(CYN) in September 2017. This almost lead to the closing of all the cryptocurrency companies including top exchanges like Binance, Huobi, and OKCoin.
On the other hand, Hong Kong now has become a shelter for cryptocurrency activity since the time it has an autonomous government that has decided on more favorable cryptocurrency regulations.
Individuals and organizations that are now “running abroad” are still doing business with Chinese residents, which is illegal and prohibited, according to Pan.
Clearly, they are being pushed by Pan to use their full power to combat investment in foreign ICOs.
All the enforcing decisions are being taken by The Internet Finance Rectification Working Group of Chinese regulators.
The Working Group will crackdown on ICOs although the working plan is still not clear. Due to the decentralized nature of cryptocurrency, even if cryptocurrency is fully banned there is no way to stop Chinese residents from using it, including the use of cryptocurrency to invest in ICOs.
Popular online forums like Zhishi Xingqiu have become an access point for ICOs to reach Chinese residents, and these are being monitored as well.
It seems that Chinese regulators are keeping a track on apps like Wechat for cryptocurrency traders. WeChat also has restricted the amount of money that can be sent through the app payment service.
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