From the beginnings of crypto-currencies, China has positioned itself as one of the biggest players in the field, particularly regarding Bitcoin. A large part of Bitcoin’s holdings were in China and about 90% of Bitcoin trade was in China. However, in 2017, the Chinese government cracked down on Bitcoin, crypto-currencies, trading platforms and ICOs. But despite this, it seems that trading platforms continue to work and ICOs still take place. Voice of China, China’s state-run media, has published reports criticizing the efforts made by Chinese cryptocurrency trading platforms and ICOs to continue operating despite Chinese government crackdowns.
Voice of China criticizes the mistrust of trading platforms
The Chinese media reports that in September 2017, the country’s central bank commissions and seven ministries issued an announcement warning of the risks of cryptocurrency issuance. At that time, they demanded that all institutions cease their activities.
In one of the reports, Voice of china said that despite the official ban, several companies have been able to find a way around censorship. In order to continue to benefit from the rising price of Bitcoin, Chinese exchange platforms created websites outside the country and continued to provide services to local users and operate as foreign companies.
The company Okex caught as a target
The reports of the Chinese state media particularly denounce the company Okex. Voice Of China accuses the company of resorting to a fraudulent ploy in addition to offering titles without licenses. To conceal its operations in China, the company uses front companies.
When the national ban was implemented, the OkCoin platform transferred all user and cryptocurrency information to the Okex exchange platform that has been established abroad. Voice of China also states that customers believe the company is out of China; the so-called headquarters of the Okex would be in Belize and the team in Hong Kong, but in reality the company still operates the company which is located in Beijing, as proof the majority of users of the platform would be Chinese.
Chinese ICOs growing despite the ban
In addition to trading platforms that continue to operate illegally, Voice of china also state the fact that ICOs are still in increasing numbers clearly challenging the government’s guidelines.
It was said last September that the issue of crypto-currencies is essentially illegal public funding. The report accuses ICOs of violating financial regulations by illegally issuing cryptocurrencies, illegally distributing property values, illegally raising funds, and contributing to illegal and criminal activities.
"One size Fits all" to rethink
Despite the very critical description of the ICOs, the professor of the Faculty of Law of the Central University for Nationalities criticized the regulations on cryptocurrencies. Being supposed to have a wide experience in the analysis and observation of crypto-currencies, Professor Jianpeng is in favor of a global dynamic and flexible regulation that promote innovation. Cryptocurrencies have characteristics that can both lead to criminal activity but also contribute to private equity.
Bitcoin and cryptocurrencies, in themselves, are not a bad thing. The problem lies rather in its use by third parties. To promote innovation, it will be necessary to review the regulations.