Today, Bitcoin (CCC:BTC-USD) and its cryptocurrency peers are once again in the hot seat. This time, news of a Chinese ban on cryptocurrencies is driving the pressure. So what do you need to know about the China crypto news? And did China really ban crypto?
Importantly, driving the news is a report from Reuters, highlighting a move by China to ban financial institutions from providing services relating to cryptocurrency transactions. China has also warned consumers against the speculative nature of crypto trading.
With this in mind, here is what you need to know about the China crypto news.
China Bans Crypto? What to Know
- According to the report, China has banned financial institutions from providing services relating to cryptocurrency transactions.
- Specifically, impacted institutions include banks and online payments companies.
- These institutions may not help with crypto registration, trading, clearing and settlement.
- Importantly, Reuters says this China crypto news comes from a joint statement of the National Internet Finance Association of China, the China Banking Association, and the Payment and Clearing Association of China.
- Investors should note that at this time, China has not banned individuals from holding cryptos.
- It seems the impetus for this decision is the recent volatility of Bitcoin and other cryptocurrencies. Recent days have knocked $20,000 off Bitcoin prices and more than $500 billion from the entire crypto market.
- These industry groups say this volatility endangers consumer property and financial safety.
- Importantly, investors should also note that this is not the first time China has taken a stand against cryptocurrency.
- For instance, in June 2019, the government blocked access to domestic and foreign cryptocurrency exchanges as well as initial coin offering (ICO) platforms.
- Because of this, some on Twitter are dismissing the latest report, causing “China FUD” to trend.
- At the time of writing, Bitcoin is trading hands for just over $43,000.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Sarah Smith is the Editor of Today’s Market with InvestorPlace.com.