China strengthens measures against cryptocurrencies

China strengthens measures and controls regarding transactions associated with cryptocurrencies. The People's Bank of China restricted various banking entities in the country from performing services for transactions in virtual currency and emphasized the need for these to identify clients that operate with bitcoin and other cryptocurrencies, he said. Criptonoticias.

The authority in question has indicated that it will be the obligation of banks and payment institutions in China to implement various requirements (eg making notices or communications available) that are part of the new regulatory requirements applicable to transactions with cryptocurrencies. Among these documents, the "Notice on the prevention of risks of Bitcoin", or the "Announcement on the prevention of financing risks of the issuance of tokens", among others, that allow said institutions to know the activities carried out by their clients to Effects of refusing to provide the opening or registration of accounts that are used for activities that are precisely related to the negotiation or liquidation of digital assets.  

Likewise, all banks and payment institutions are required to implement supervision and monitoring measures associated with virtual currency exchanges and payments of funds that are associated with transactions with bitcoin or others. According to the authority, the objective of the imposed measures is to prevent the risks derived from the use of cryptocurrencies for a country, specifically, the alteration of the normal economic and financial order of a country, as a consequence of illegal international transfers of assets, money laundering, among other illegal activities.

The action of the Chinese government is not strange, even more so if it is taken into account that in recent months, it has placed emphasis on activities or transactions related to cryptocurrencies, under the argument that these enhance and promote illegal activities. Likewise, other activities related to the digital asset would also have been restricted such as cryptocurrency mining.

In line with the above, it would seem that the cryptocurrency industry in China has a bleak future, as the strong measures adopted would not allow transactions involving these cryptocurrencies to run normally. It is interesting to observe closely the actions taken by a country like China, which is a world power and a benchmark in the use of technology and investments, especially by countries that have been evaluating the adoption of regulatory measures and provisions with an impact on the use of this digital asset.

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Erika Rios
Erika is a lawyer from the Peruvian University of Applied Sciences (UPC). He has experience in banking regulatory advice and financial transactions, mainly in financing with local and foreign financial entities. He currently works at Vodanovic Legal, an expert legal firm in financial law issues. He specializes in Banking Regulation and Fintech.

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