Chinese authorities have been taking restrictive measures against virtual currencies such as Bitcoin since 2013.

The Cyberspace Administration of China, the internet regulatory body in the Asian country, closed 12,000 accounts on social networks because they promoted investment in cryptocurrencies, whose activities were declared illegal by the national authorities, local press reports today.

According to the economic news portal Yicai, the institution “continues to carry out a high-pressure campaign against speculation on cryptocurrency transactions”, within the framework of which it claimed platforms such as Weibo or Baidu – local equivalents of Twitter and Google, censored in the country – to close the aforementioned accounts.

Also, more than 51,000 messages containing “illegal information” such as “invest in Bitcoin to earn money easily” were deleted.

Cyberspace Administration of China: Further Actions

Authorities also shut down more than a hundred websites that promoted cryptocurrencies and had published tutorials on mining or “cross-border speculation” with virtual currencies.

The Cyberspace Administration promised to further “strengthen” its campaign against cryptocurrencies, whose rise has caused, according to its analysis, “an increase in speculation and fraud.”

Chinese authorities have been taking restrictive measures against virtual currencies such as Bitcoin since 2013; Less than a year ago it was the turn of the People’s Bank of China (PBC, the central bank), which declared all activity related to cryptocurrencies, including transactions, mining and advertising, “illegal and criminal”.

In 2017, the Chinese authorities had already closed the national cryptocurrency exchange platforms. In 2019, PBC, the central bank, announced the blocking of access to web pages where cryptocurrencies were offered.

Why Cryptocurrencies are Illegal in China

It is worth remembering that, according to the People’s Bank of China, digital currencies, such as Bitcoin or Ether, cannot circulate in the market because they are not fiduciary currencies, in addition to the fact that their use has disrupted “the economic and financial order” and encouraged activities such as “money laundering, fundraising illegal, fraud, pyramid schemes, and other illegal activities”.

On the other hand, the Chinese government argues that the environmental aspect is reason enough to ban cryptocurrency-related activity. In China, there is a large concentration of crypto miners; this situation collides with the nation’s efforts to curb greenhouse gas emissions.

Likewise, Beijing argues that the ban is necessary to “maintain economic, financial and social order”, and its campaign is part of the government’s financial risk reduction plans, which, it should be remembered, is working on its own “digital yuan,” a digital currency that, unlike other cryptocurrencies, does not intend to decentralize, but to increase the control of the BPC over the money supply.

In the past, Chinese miners had come to control more than 65% of the world’s computing power dedicated to mining Bitcoin, thanks in part to low electricity prices in certain regions of the country.

By Audy Castaneda

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