Cryptocurrency prices rose on Monday days after Chinese banking authorities announced a crackdown on digital currency trading.
At the last check, Bitcoin, the world’s largest cryptocurrency, rose 1.3% to $ 43,750, according to CoinDesk. Ethereum rose 3.5% to $ 3,105 and Dogecoin edged up to 20 cents.
On Friday, the People’s Bank of China issued a blanket ban on cryptocurrency trading, declaring all forms of digital transactions and financing as “illegal activities strictly prohibited.”
In response, Huobi Global, one of the world’s largest cryptocurrency exchanges, said it will shut down all user accounts in mainland China by the end of the year.
At last check, Huobi’s exchange token, HT, was up 2% to $ 7.59, after falling immediately after China’s announcement.
Winston Ma, former managing director and head of North America at China Investment Corp., said that “in the history of Chinese government crypto regulation, this is the most direct and comprehensive framework involving the greatest number of ministries “.
“The new addition from the Supreme Court and Supreme Procuratorate suggests that greater criminal law enforcement could take place with respect to crypto mining and trading; and the involvement of [the State Administration of Foreign Exchange] means more government attacks on cross-border capital flow services provided by offshore exchanges, ”he said.
Ma is the author of “The Digital War – How China’s Tech Power Shapes the Future of AI, Blockchain and Cyberspace”.
He noted that the crackdown in China comes as the central bank tests its own digital currency for its official launch. This launch could take place as early as next year.
In addition to bitcoin and ethereum, “this new notice mentions tether / USDT for the first time in government regulations,” he said.
David Lesperance, Managing Partner of Immigration and Tax Advisor Lesperance & Associates, said he had been predicting China’s actions for some time as the government moved to end any potential competition with the new e-yuan.
“However, it was shocking to see my prediction come true,” he said.
“All of the inquiries I receive are from Chinese and Hong Kong-based crypto holders on strategies they can put in place to protect their crypto assets” and their “individuals and families.”