As Beijing stepped up its crackdown on Bitcoin trading and mining, a large number of crypto-related accounts on China’s Twitter-like Weibo platform were blocked over the weekend.
According to analysts and financial regulators, more actions are expected, including linking China’s illegal encryption activities more directly with the country’s criminal law.
Last month, China’s State Council or Cabinet vowed to crack down on Bitcoin mining and trading, escalating its anti-cryptocurrency campaign a few days after three industry bodies banned cryptocurrency-related financial and payment services.
Over the weekend, several widely watched encryption-related Weibo accounts were denied access, with a message saying that each account “violated laws and regulations.”
“This is the trial day for crypto KOLs,” a Weibo Bitcoin commentator or key opinion leader (KOL) wrote, calling herself a “Bitcoin Mini Female Doctor.” Her main account was also blocked on Saturday.
When talking about Tesla’s founder and cryptocurrency enthusiast, Winston Ma, an adjunct professor at New York University School of Law, said: “The government has made it clear that there is no Chinese version of Elon Musk in China’s cryptocurrency market.”
Jack Ma is the author of the book “Digital Warfare”. He also expects that China’s Supreme Court will soon issue a judicial interpretation linking cryptocurrency mining and trading operations with China’s criminal law.
A financial regulator responded to this view, saying that this interpretation would resolve the legal ambiguity that failed to clearly identify the Bitcoin transaction business as “illegal operation.” So far, all China’s rules on cryptocurrencies have been issued by administrative agencies.
As Weibo was frozen, Chinese media increased their coverage of crypto transactions.
The official Xinhua News Agency published an article exposing a series of encryption-related scams. CCTV stated that cryptocurrency is a loosely regulated asset that is often used in black market transactions, money laundering, arms smuggling, gambling, and drug transactions.
While stepping up its crackdown, the People’s Bank of China is also accelerating its testing of its digital currency.
© Thomson Reuters 2021