Chinese central bank doubles down on crypto crackdown as speculation resurfaces
Crypto transactions ‘remain illegal’ in China, say top officials.People’s Bank of China’s decision to reveal high-level crypto talks with ministries ‘is a first.’Experts say Beijing won’t welcome Bitcoin miners back.China’s central bank has quashed talk of relaxing its sweeping crackdown on crypto amid calls for Beijing to let Bitcoin miners return.The People’s Bank of China, also known as the PBoC, summoned representatives from government ministries, internet regulators, and the judiciary to make a fresh statement on crypto regulation, the Chinese newspaper Caixin reported.“Cryptocurrencies do not have the same legal status as legal tender,” said the PBoC. “They do not have legal tender status. And they should not and cannot be used as currency in the market. All cryptocurrency-related business transactions constitute illegal financial activities.”While reports continue to circulate in China and elsewhere claiming that illegal mining is on the rise, the chances of the Middle Kingdom embracing Bitcoin appear very remote for the time being.Top-level summitThe bank convened the meeting on November 28, as part of its efforts to “coordinate ways to combat speculation” in the crypto trading space.The list of attendees attests to the severity of the PBoC’s message. It included the representatives from the public prosecution service, the supreme court, all of China’s top financial and internet regulators, policy-making bodies, and three government ministries.“This is the first time that regulatory authorities have disclosed details of such a meeting,” Caixin explained.The Chinese media outlet Guandian said that the PBoC’s decision to make the details of the meeting public was a response to the fact that crypto “speculation has resurfaced” in China.China ordered banks to block and report all crypto-related transactions in 2021. It also issued a ban on crypto mining.The popularity of Bitcoin has not dampened in China, however. DL News has seen evidence that over-the-counter trading with vendors and buyers in nearby nations like South Korea and Japan continues via Telegram open chat rooms.The bank told the attendees that they should “deepen” their “coordination and cooperation, and improve regulatory policies and legislation” to intensify the crypto crackdown.”The PBoC called on the parties to “monitor capital flows, bolster information sharing networks, further enhance monitoring capabilities, and severely crack down on illegal and criminal [crypto-related] activities.”Doing so, it claimed, would help “protect the safety of public property, and maintain the stability of economic and financial order.”Data from the crypto miner Luxor Technology shows that China’s share of the global Bitcoin hashrate stands at over 14%. That figure may originate exclusively from illegal mining, but it is only eclipsed by the United States and Russia.Bitcoin mining ban ‘here to stay’The South China Morning Post said that in recent months, there have been “increased calls from scholars for Beijing to reconsider its rigid bitcoin mining ban.”But the same media outlet quoted David Zhang, a macroeconomics and policy analyst at the China-focused policy researcher Trivium China, as stating that China’s bold AI goals “would not permit energy-intensive activities that contradict its development goals, such as Bitcoin mining, to persist or expand.”Yang Liu, a partner at the Beijing-based legal firm DeHeng Law Offices, said it was unlikely that the Chinese government would want to “encourage mining activities in the short term, let alone get involved in mining itself.”Tim Alper is a news correspondent at DL News. Got a tip? Email at tdalper@dlnews.com.
