For years, China has been consistent in its crackdown on cryptocurrencies. This move in 2017 affected cryptocurrency exchanges, including the world’s largest exchange, Binance, which had to end its crypto-related activities in mainland China. However, they still allowed trading in the Chinese currency, the yuan. It seems that with the end of 2021, this too is about to change.
Binance ends yuan and OTC trading in China
In order to comply with local regulations, the world’s largest cryptocurrency exchange, Binance, has announced that it will stop handling OTC trading of yuan (CNY) for Chinese users as of December 31, 2021. Shortly after the announcement was made, the Chinese market plummeted.
Binance is not the only exchange affected by China’s new regulations. The Chinese authorities’ ongoing repression of cryptocurrencies has forced major exchanges to pull out of the Chinese market, including the Huobi exchange. These platforms are already starting to block Chinese customers from accessing each other. In the case of Binance, all Chinese users have been switched to withdrawal mode. This means that they will only be able to close their positions and withdraw funds.
The consequence of such a move is that Chinese citizens are turning to decentralized exchanges, known as DEXs. These venues remain the only viable alternative for crypto trading in the face of such restrictive regulations.
The Chinese government is taking it a step further
In this case, it also looks like the Chinese government will not hesitate to use all available means to “finally settle” crypto. Word has reached us that Chinese websites have been ordered to block certain keywords related to cryptocurrency exchanges. China’s popular social media platform, WeChat, has already blocked search terms related to crypto. Chinese media also suggest that the Central Bank of China plans to “immediately clean up and fix” all platforms that help illegally trade cryptocurrencies. In the state media, these actions are called “improvement”.
All the Chinese actions discussed above highlight how determined the current authorities are to finally end cryptocurrency trading in China. Will they succeed this time? We will keep you updated with the latest news on our portal.