China’s Central Bank Meets With Five Banks to Toughen Stance on Crypto

China’s central bank has reportedly held conversations with five financial institutions from across the country to discuss the growing hype around cryptocurrencies and further widen the crackdown on the emerging industry.

According to the Financial Association News, the organizations involved included  Industrial and Commercial Bank of China, Agricultural Bank of China, Construction Bank, Postal Savings Bank of China, Industrial Bank, and Alipay (China ) Network Technology Co., Ltd. 

The Central bank conducted the meeting to request that these banks and payment institutions stop participating in any crypto-related business or provide any cryptocurrency services such as account opening, registration, and performing transactions.

They are also prohibited from selling crypto products or services such as trading, clearing, and settlement.

The organizations also stipulated that they strictly implement the  “Notice on Preventing Bitcoin Risks” and “Announcement on Preventing Token Issuance Financing Risks” policies alongside other regulatory requirements that include proper identification of customers, investigating, and cutting off any virtual currency exchanges or related platforms.

 According to various departments of the People’s Bank of China, the reason for the measures taken against crypto is that “virtual currency trading activities disrupt the normal economic and financial order, breed the risks of illegal cross-border transfer of assets, money laundering and other illegal and criminal activities, and seriously infringe the people’s property safety.”

The bank and payment institutions finalized the interview with a promise to adhere to the different rules implemented on the crypto issue.

Earlier in May, the country’s authorities made up of the National Internet Finance Association of China, the China Banking Association, and the Payment and Clearing Association of China, issued a statement banning all financial service providers in the country from performing any crypto-related transactions.

The ban prohibits financial institutions and payment companies from providing cryptocurrency services to their clients, including registration, trading, clearing, and settlement.

A few days later, the State Council’s Financial Stability and Development Committee mentioned that the country will take strong actions against bitcoin mining and trading activities to avoid financial risks.