China is at it again!
The communist country has tightened restrictions on cryptocurrency after traders found loopholes that permitted them to continue to buy and sell BTC coins using offshore exchanges.
This report is according to Yicai—a Shanghai-based publication.
Offshore cryptocurrency exchanges are being watched by the metaphorical hawk that is China as well as domestic websites utilised by traders and investors within the country to aid in peer-to-peer (P2P) trades.
The department has put specific examination on digital currency exchanges that were in the past headquartered in mainland China but moved their operations in response to the fiat-to-cryptocurrency trading ban, which was placed in force by the People’s Bank of China (PBoC) in September, 2017.
The government claims that it has instigated these policies to avert pyramid schemes, money laundering, and other false activities associated with the crypto-currency industry.
In spite of actively policing these cryptocurrency trading venues, authorities have been ensuing months struggling to maintain enforcement of those stringent policies, as small-scale traders have begun trading through P2P and over-the-counter (OTC) platforms, while others have successfully opened accounts at offshore platforms that offer conventional order-book trading.
Yet, in many ways, authorities have been essentially successful in their pursuit to restrain trading — even if they have failed to stamp it out entirely.
These constraints made cryptocurrency trading volume denominated in the Chinese renminbi (RMB) to plunge from a peak of 90% to a current value projected to be less than a percent.
Many cryptocurrency sceptics anticipated that such a dramatic drop-off in China-based trading would be bad for Bitcoin and its competitors, but those guesses have been proven wrong.
Indeed, this squeeze on mainland RMB trading failed to have a lasting effect on the global cryptocurrency markets, and both South Korea and Japan and have emerged in the incident’s wake as major forces in both the regional and global ecosystems.