May 11, 2023
By Anjali Kochhar
Since September 2021, China has implemented a crypto ban, but this has not deterred its citizens from engaging in digital asset transactions. According to a Bloomberg report, many Chinese investors are using FTX crypto exchange for credit claims. Additionally, Binance and OKX have also reported substantial usage by Chinese individuals.
As per the report, over 9 million customer accounts on the FTX exchange are attributed to Chinese users who make up 8% of the claims.
Caroline Malcolm, who is the global head of public policy at Chainalysis, suggested that the crypto ban in China has been either ineffective or only loosely enforced. She added that the decentralized nature of cryptocurrencies and their ability to be traded globally and peer-to-peer pose difficulties for any government to completely eradicate them.
Insiders in the industry have revealed that they utilized Chinese identities on major exchanges to fulfill the know-your-customer requirements. Another significant crypto exchange, Huobi Global, purportedly served Chinese users, some of whom were offered the opportunity to obtain a “digital identity” from the Dominican Republic to circumvent the ban.
What other countries are doing?
The Reserve Bank of India is in favour of a comprehensive crypto ban, although it has not yet implemented one. Governor Shaktikanta Das stated in February that some members of the G20 had proposed exploring the possibility of a complete ban on cryptocurrencies. However, officials from G20 finance ministries and central banks seemed to agree on the need to regulate crypto assets, with a complete ban being a potential option.
In an effort to combat financial fraud, other countries are imposing bans on certain activities involving cryptocurrencies.
For instance, the UK has outlawed cold calling for promoting cryptocurrencies and other financial products. Recently, Argentina’s central bank prohibited payment companies from enabling crypto transactions to minimize the country’s exposure to digital assets in its payment system. Thus, implementing partial bans may be beneficial.
Numerous countries are still concerned about the risks posed by cryptocurrencies. China recently introduced standards for managing crypto-related financial trials, stating that crypto assets have some features of virtual network property and seeking to halt what it considers to be hazardous activities.
About the author
Anjali Kochhar covers cryptocurrency stories in India as well as globally. Having been in the field of media and journalism for over three years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.
