China Joins CBN, Bans Cryptocurrency Transactions

Five Things You Didn’t Know About Bitcoin, Other Cryptocurrencies
Five Things You Didn’t Know About Bitcoin, Other Cryptocurrencies

Three months after the Central Bank of Nigeria (CBN) banned banks and other key players in the financial sector from cryptocurrency transactions, China has followed suit as it restricted institutions and payment companies from providing services related to cryptocurrency transactions.

It also warned investors against speculative crypto trading.

The CBN, in February, had directed banks and other financial institutions to close any accounts dealing in cryptocurrency or facilitating payment for cryptocurrency exchange, with immediate effect.

A Reuters report yesterday said the ban by China was its latest attempt to clamp down on what was a burgeoning digital trading market.

Under the ban, such institutions, including banks and online payments channels, must not offer clients any service involving cryptocurrency, such as registration, trading, clearing and settlement, three industry bodies said in a joint statement.

“Recently, cryptocurrency prices have skyrocketed and plummeted, and speculative trading of cryptocurrency has rebounded, seriously infringing on the safety of people’s property and disrupting the normal economic and financial order,” China said in a statement.

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The institutions must also not provide saving, trust or pledging services of cryptocurrency, nor issue financial product related to cryptocurrency, the statement added.

The ban was not Beijing’s first moves against the digital currency. In 2017, China had shut down its local cryptocurrency exchanges, smothering a speculative market that had accounted for 90 per cent of global bitcoin trading.