Říj 08

U.S. Senate Candidate Vows to Speak with President Trump About Clemency for Ross Ulbricht

Ross Ulbricht could have a powerful voice advocating for his freedom if U.S. Senate Candidate Eric Brakey is elected.


Cruel and Unusual Punishment?

Ross Ulbricht, the founder of Silk Road, is a less than 4 years into his double life sentence for his involvement in running the Silk Road exchange. Since his conviction, a Change.org petition has advocated for a reduction or re-evaluation of his sentence — many view the punishment as cruel and unusual. Still, the chances of the petition succeeding are slim to none. Upon sentencing, the court tossed an additional 40 years on top of Ulbricht’s sentence, and he is not eligible for parole.

Ross Ulbricht

To date, nearly 84,465 people have signed the petition stating that Ulbricht’s investigation and sentencing violates his Fourth and Sixth Amendment rights. The number continues to grow. Furthermore, allegations of investigative corruption, prosecutorial misconduct, and constitutional rights violations are cited as reasons for Ulbricht either needing to receive clemency or the right to appeal his case before the Federal Courts.

While the odds of ever walking freely are certainly stacked against Ulbricht, a recent petition by a U.S. Senate candidate for the state of Maine could bring the possibility of freedom a tad bit closer for Ulbricht.

The Silk Road Lives On

Republican Senate candidate Eric Brakey (D-ME) recently tweeted that Ulbricht has, “very clearly been treated unfairly by our criminal justice system.” In addition to signing his change.org petition, Brakey found the fact that “the judge considered pending charges during sentencing that were later dismissed due to corruption by federal investigators […] terrible.” Brakey has promised to raise the issue with President Trump “when I win election to the U.S. Senate this November.” Ulbricht and Brakey have now exchanged a series of tweets, and Ulbricht affectionately refers to Brakey as his “new favorite Senate candidate”.

The Supreme Courts Adds an Extra Nail to the Coffin

In June of 2018, the U.S. Supreme Court denied Ulbricht’s petition for a writ of certiorari. This essentially permanently prevents Ulrich from appealing his punishment before the Supreme Court. This move motivated the Libertarian Party to draft and pass a resolution appealing to President Trump to provide a full, unconditional pardon to Ulbricht. 

Sen. Eric Brakey (D-ME)

Ulbricht’s involvement with The Silk Road marred the public’s perception of cryptocurrency, but as blockchain and cryptocurrency adoption by the wider public and international businesses has grown, the negative image has begun to dissipate. Furthermore, a growing number of people are also beginning to question the severity of Ulbricht’s sentencing as the drug policies of numerous states change, and the nature of online marketplaces evolves.

Do you think Ross Ulbricht should receive clemency from President Trump? Share your thoughts in the comments below! 


Images courtesy of Bitcoinist archives, EricBrakey.com, Shutterstock.

Share
Zář 29

‘Nothing At All’ Going on With Crypto Regulation, Says D.C. Insider

Despite the growing importance of the cryptocurrency industry, the US government’s position on crypto regulation remains frustratingly opaque. According to a D.C. insider, a movement towards real regulation or greater regulatory guidance is still quite far away.


Regulatory Uncertain

Questions about how the government intends to regulate the crypto industry abound. For example, it is still unclear to many investors whether crypto regulation will ultimately come from the SEC or the CFTC.

While there remains no widespread movement in Washington towards reforming the crypto regulatory environment, there are encouraging signs that pockets of Congress are beginning to take interest in the cause.

Beginnings of Congressional Action?

On September 24th, Rep. Warren Davidson (R-OH) hosted industry leaders from Wall Street, Silicon Valley, and the crypto industry for a roundtable discussion on the crypto regulatory environment. Davidson’s roundtable, titled “Legislating Certainty for Cryptocurrencies,” was held at the Library of Congress. Roughly eighty thought leaders from the private sector attended the roundtable, with multiple members of Congress and their aids in attendance as well.

Davidson stressed the importance of industry being involved in crafting the government rules that will eventually govern the crypto space.

Congress

Congressional Letter to the SEC

Following the roundtable, Davidson and fourteen other Representatives issued a public letter to SEC chairman Jay Clayton requesting that the SEC issue clarification on whether Initial Coin Offerings are considered security sales. The Representatives used the letter to express concern that all tokens were being treated as securities, regardless of whether the designation was applicable or relevant. The letter stated:

Therefore, we believe is important that all policy makers work toward developing clearer guidelines between those digital tokens that are securities, and those that are not, through better articulation of SEC policy, and, ultimately through formal guidance or legislation.

The letter went on to express concern that existing guidance on SEC policy is being conveyed solely through enforcement action, leading market participants forced to try to divine SEC policy through the scope of its enforcement actions. The letter continued:

Additionally, we are concerned about the use of enforcement actions alone to clarify policy and believe that formal guidance may be an appropriate approach to clearing up legal uncertainties which are causing the environment for the development of innovative technologies in the United States to be unnecessarily fraught.

Legislstion

New Legislation Begins to Emerge

While no major legislation has been introduced to cover the crypto industry, U.S. Representative Tom Emmer (R-MN) has introduced a slate of three bills designed to encourage support for the crypto industry. Emmer’s bills propose only minor changes to how cryptocurrency is regulated in the U.S.

Concerns about the regulatory status of various crypto projects have encouraged many entrepreneurs and firms to decamp to more stable regulatory climes. For example, Switzerland’s “light-touch” regulatory policy has fueled the dramatic growth of the industry in the country.

While it is encouraging to see the government finally begin to take interest in the crypto industry, the Congressional letter stressed that SEC guidance would take time to fully emerge and develop. Start-ups and entrepreneurs hoping for greater regulatory clarity will likely still have a long time to wait.

Will U.S. regulators eventually wake up? Let us know in the comments below!


Images courtesy of Shutterstock, Twitter/@.

Share
Čvc 08

South Korea Moving Towards Cryptocurrency Acceptance

South Korea is continuing to legitimize and embrace cryptocurrency through a careful and considered approach.


‘The regulator isn’t opposed to cryptocurrencies’

On May 19, Bitcoinist reported that Korean regulators had agreed to apply the G20’s set of “unified regulations” in regards to cryptocurrencies. South Korea’s Financial Supervisory Service (FSS) stated at that time:

It’s almost certain that cryptocurrencies will be classified as assets and the main issue will be centered on how to regulate them properly under the unified frame that will be agreed upon between G-20 nations. Given the current stance, this isn’t good, but we will step up efforts to improve things.

Now, The Korea Times has reported that the country’s regulators are indeed set to ease regulations regarding cryptocurrencies — as the Financial Services Commission (FSC) has revised its guidelines for cryptocurrency exchange operators.

One official told the oldest English-language newspaper in South Korea:

The FSC made revisions to its rules to apply strengthened policies in order to prevent or detect money laundering and illegal activities because the regulator isn’t opposed to cryptocurrencies.

Another official stated:

Establishing unified rules is a complicated issue given the broader range of assessments between government agencies. This is why the country needs close international cooperation as it is still in the early stages of fine-tuning guidelines.

How Icon (ICX) and Others Skirt South Korean Restrictions

The government’s stance and actions thus far indicate an interest in encouraging blockchain technology and the growth of cryptocurrencies, but not at the expense of safety and security. Stated one trade ministry official:

Any major reversal in policies is unlikely, but the government seems to believe a gradual shift in attitude toward crypto-based assets is needed. What regulators should do is figure out how to regulate them properly and prudently as Korea needs to put more emphasis on blockchain technology after obtaining knowhow and understanding of the possible flipside of cryptocurrency trading.

‘Interest in cryptocurrencies will double’

The report comes shortly after South Korea moved to recognize cryptocurrency exchanges as legal entities in their own right for the first time, cementing their position in the local economy.

Seoul-based technology journalist Kim Byeong-yong also told The Korea Times that mainstream adoption is likely coming to South Korea in the future, explaining:

Global banks predict that interest in cryptocurrencies will double. We believe an increase in adoption will come when crypto-assets can be used as actual currencies rather than just speculative investments.

What do you think about South Korea’s regulatory stance regarding cryptocurrencies and blockchain technology? Do you think mainstream adoption is in the cards? Let us know in the comments below! 


Images courtesy of Shutterstock, Bitcoinist archives.

Share
Dub 27

Crypto Arbitrage Trading – The Pursuit of Happiness

· April 27, 2018 · 5:00 pm

Arbitrage exists as a result of market inefficiencies and would therefore not exist if all markets were perfectly efficient. How does one capitalize on this market phenomenon?


A trader who, in 1970, pioneered a computerized trading system once said:

The elements of good trading are: (1) cutting losses, (2) cutting losses, and (3) cutting losses. If you can follow these three rules, you may have a chance.

This is, of course, Ed Seykota, a former commodities trader. A lot has changed since he first introduced this system, with the onset of blackbox and algorithmic and high-frequency trading, it is harder than ever for point and click traders to make money.

The market has evolved and the inefficiencies that it suffered from in the 70s are unlikely to return. However, while the capital and debt markets are now highly efficient and, for the most part, very liquid, the same cannot be said for cryptocurrency markets. For one, the dissemination of information to the trading community is highly inefficient. The systems that aggregate volume and other data from various exchanges are still in their infancy and most importantly, the size of the trading community is growing every day.

Trading

Nobody Knows If a Stock Is Going to Go Up, Down, Sideways or in Circles

Those that have seen the film “Wolf Of Wall Street” will remember the scene with Matthew McConaughey and Leonardo DiCaprio, where Matthew McConaughey goes on to say “Nobody knows if a stock is going to go up, down, sideways or in circles.”

Is trading an art, a science, or is it no different than gambling and simply requires a degree of luck? Whatever camp you side on, crypto markets provide a unique opportunity to make very good returns on your investment. You don’t always have to be a trend follower or a contrarian, the smart way to approach crypto trading is by applying arbitrage models. The problem, of course, is standardizing the API data from the exchanges. While it is not an impossible task, it can be very laborious and requires a great amount of checking to ensure consistency between the different data feeds.

Despite the fact that the cryptocurrency markets are trading with extremely high-volume levels, they are not nearly as liquid as we might think. This market is still highly fragmented in a web of exchanges under very different jurisdictions. The liquidity is spread through various more or less trustworthy exchanges all over the world. The emergence of more trustworthy regulated exchanges has boosted the overall liquidity but has not yet delivered the desired effect of lowering spreads and slippage costs. Furthermore, increasing liquidity would definitely encourage significant institutional investments and promote mainstream adoption.

Arbitrage

Trading Edge

Volatility is something that has discouraged this much sought after mainstream adoption. This measure is related to uncertainty with regard to the extent of price changes. High volatility is evidenced in sharp and unpredictable price swings, while assets with low volatility will see little or minimal fluctuation in prices over a short-term horizon.

There are various strategies one can follow to capitalize on the potential arbitrage opportunities that currently exist across crypto markets. No one can tell for sure how long these opportunities will remain available, as the broader adoption of these assets by the general public will invariably reduce bid/ask spreads and increase trading volumes. However, for now, one can simply make comparisons between different exchanges to understand the magnitude of potential returns on capital.

The following numbers should be taken as an indication, these are not fixed levels and are subject to change. The price of Bitcoin on HitBTC is 2.55% higher than the price of the same asset on Exmo. Nowhere in capital markets can such discrepancy occur with what is said to be a leading asset in the digital economy and the spread on altcoins can sometimes be even greater.

There are different ways to trade the same markets, directional, technical, contrarian, fundamental – or you can utilize a combination of the above and create a strategy that works for you.

What do you think of market structure and is regulatory uncertainty to blame for such fragmented markets? Let us know in the comments below.


Images courtesy of Pxhere and Shutterstock.

Show comments

Share
Dub 15

Hong-Kong Based Exchange OKEx Plans to Move to Malta

· April 15, 2018 · 4:00 pm

OKEx, one of the largest exchanges in the world, has announced plans to move to the European island, Malta. This announcement came quickly after a similar announcement made by Binance, one of OKEx’s main competitors.


In an attempt to gain an understanding of the political climate around cryptocurrencies in Malta, OKEx’s executives met with the Maltese government. While many EU countries are taking a standoff-ish, if not downright hostile, approach to cryptocurrency, Malta – which aims to become a ‘global pioneer’ for cryptocurrency – has proven to be extremely welcoming to crypto and blockchain businesses.

Currently, OKEx only offers crypto to crypto trading along with a futures market. OKEx is currently based in Hong Kong, which has probably made it difficult for the exchange to obtain the required licenses to allow for a fiat gateway to be opened in collaboration with banking systems.  However, some suspect that with the move to Malta, that the exchange will open fiat to crypto trading, which will become an essential part of any successful exchange in the near future. 

OKEx CEO Chris Lee stated:

We look forward to working with the Malta government as it is forward thinking and shares many of our same values: the most important of which are protection of traders and the general public, compliance with Anti Money Laundering and Know Your Customer standards, and recognition of the innovation and importance of continued development in the Blockchain ecosystem.

Malta – a Global Pioneer for All Things Crypto

Since the rise of the cryptocurrency industry, Malta has been continually open to accepting companies who are looking for a bit more wiggle room with regard to regulations. As a result of this, Malta has established itself as the crypto and blockchain ‘go to’ locale as more startups and exchanges flock to the country.

Malta - a Global Pioneer for All Things Crypto

Earlier in 2018, Malta’s government announced their plans for a new segment of the government called the Digital Innovation Authority which aims to provide full legitimacy for blockchain and cryptocurrency companies alike.

It is unlikely that Malta will be averse to any legitimate cryptocurrency or blockchain company in the future as their policy plans indicate that they are willing to keep cryptocurrency rules minimal.

OKEx Chief Risk Officer and Head of Government Relations noted:

Malta’s Virtual Financial Asset Act is a solid foundation for the industry and the government to work together in fostering the nascent blockchain/digital asset industry. More specifically, Malta’s sound risk-based approach will help cultivate a responsible, compliant, and healthy ecosystem.

Do you think that the cryptocurrency and related technology industry will flourish in Malta? If not, where else? Let us know in the comments!


Images Courtesy of  AdobeStock, iStockPhoto

Show comments

Share
Bře 20

4 Ways Criminals Are Trying to Cash out Their Bitcoin

· March 20, 2018 · 2:30 pm

Due to the increased spotlight on cryptocurrency, criminals are finding it more difficult to cash out their Bitcoin for fiat, but they are finding ways to do so.


A common media portrayal is that of a criminal who plies their trade on the Dark Web and amassing a fortune in Bitcoin. It is true that the daddy of cryptocurrency can be used for all manner of illicit transactions, but an interesting phenomenon is now occurring. While some criminals have amassed a veritable fortune in bitcoins, they are finding it increasingly difficult to cash out the cryptocurrency to fiat. However, they are finding some ingenious ways to do so.

money

A Hard Knock Life

A recent report by Vice highlights this issue that criminals are having. People who conduct illicit business on the Dark Web, such as selling stolen information or malware, are making some serious money, but they are facing obstacles in converting that digital wealth into actual fiat currency.

The main reason for this problem is that cryptocurrency is the victim of its own success. The massive surge in value towards the end of 2017 shone a very bright spotlight upon the cryptocurrency sphere, catching the attention of law enforcement and regulatory bodies.

The increasing acceptance of cryptocurrency has led to more regulations being put into place, such as exchanges requiring verifiable information from its users. Law enforcement has also become more adept at infiltrating the seedy underbelly of the crypto sphere, not to mention keeping a sharp eye on large-scale transactions.

Some Savvy Criminals

This increased scrutiny has led criminals to try to cash out their Bitcoin. Swiss bankers have reported being contacted and offered a 10% payment if they could facilitate large-scale transfers; offers that they have, so far, rejected.

cybercriminal

However, criminals can be an ingenious lot at times. A few methods for cashing out their bitcoins were revealed to Vice. One such method is using Western Union. An online drug dealer says he uses services that will automatically transfer cryptocurrency to accounts belonging to Western Union. Then he uses another person to pick up the fiat.

Probably the safest way to cash out is to sell the Bitcoin to a trusted person in the real world. A malware seller tells Vice that he regularly sells cryptocurrency to a local person a few times per week, who then leaves a bag of cash on their porch a few hours after the crypto is transferred. Another method is to work with a company that charges pre-paid debit cards with cryptocurrency. Criminals note that the card issuer does not know what is being used to charge the card as another company handles that. If the card requires some documents, fake ones can be procured on the Dark Web.

Law enforcement notes that another viable option for criminals is to use a bank in Eastern Europe. Regulations dealing with cryptocurrency are much more lax in that particular region. In fact, Europe is currently known as a weak link when it comes to money-laundering and cryptocurrency. Even now, such enforcement is not high on the EU list of priorities, which is something that cybercriminals are very aware of. In addition, criminals are now moving away from Bitcoin and into other cryptocurrencies that are far more private.

Do you think criminals will always find a way to cash out their cryptocurrencies? Let us know in the comments below.


Images courtesy of Pexels, Pixabay, and Bitcoinist archives.

Show comments

Share
Bře 07

SEC Chairman: ‘Abide by the Law. We are Watching.’

· March 7, 2018 · 12:30 pm

Securities and Exchange Commission (SEC) Chairman Jay Clayton went on FOX Business yesterday to inject some fear into investors — particularly those interested in Initial Coin Offerings (ICOs).


‘We Are Watching’

SEC Chairman Jay Clayton has issued a serious threat to the cryptocurrency space and, in particular, to ICOs.

Clayton — who was nominated by President Donald Trump — initially claims he’s just got investors’ best interests at heart, telling FOX Business:

I worry in particular about people who see things that look like a New York Stock Exchange or NASDAQ listing for ICOs or cryptocurrencies and think that I’m getting the same protection for my token that I would be getting for a share of stock that trades on an exchange. They’re not.

Now that you know Clayton’s got your back, you can also rest assured that he and the SEC are investigating whether or not ICOs are violating securities laws. He told FOX Business:

Many ICOs and many of the ones I’ve looked at specifically are securities. … For some reason, people selling ICOs seem to think they don’t need to follow either path; they seem to think they can have the best of both worlds: a limited disclosure from a private placement and public trading and public offering of the token.

SEC

Unsurprisingly, Clayton’s concerns rest primarily with how ICOs raise their capital. He explained:

We have seen instances where companies seem to have had trouble raising money in a traditional private placement and then have switched to an ICO in order to raise the money. The business hasn’t changed substantively, but it’s a form-over-substance way to raise money. That is troubling.

Nevertheless, Clayton knows a war against cryptocurrency will ultimately not work in anybody’s interest — particularly his. Thus, he pretends he wants to open a constructive dialogue, while at the same time sending a threatening message:

It’s important to understand that the fundamentals of our securities laws do apply in this space. It’s a technology with great promise. … It’s a technology that I really think is pretty cool and can change the way people do business at a great deal of efficiency, but it doesn’t mean that you can obviate our tried-and-true approach to the federal securities laws.”

Clayton’s entire discussion can ultimately be summed up in three authoritarian sentences:

Abide by the law. We are watching. Others are watching.

What do you think of Clayton’s warning? Do you think ICOs should be more careful with how they raise funds? Let us know in the comments below!


Images courtesy of Bitcoinist archives.

Show comments

Share
Úno 11

New Jersey Cracks Down on Fraudulent Bitstrade

· February 11, 2018 · 7:00 am

Following the fallout from fraudulent Ponzi-scheme Bitconnect’s demise, New Jersey has officially ordered cryptocurrency investment entity Bitstrade to stop offering unregistered and fraudulent securities in the state.


New Jersey regulators have uncovered yet another fraudulent cryptocurrency investment company.

The announcement comes by way of Attorney General Gurbir S. Grewal and the Division of Consumer Affairs and has been ordered by the Bureau of Securities after an investigation found Bitstrade to be in violation of New Jersey’s Uniform Securities Law.

ponzi scheme

Bitstrade was found to have sold unregistered securities while guaranteeing upwards of 10 percent daily returns, despite lacking a proper registration to sell securities in New Jersey.

Bitstrade also failed to disclose what have been deemed “key material facts” to prospective investors, including an official address, the names of its executive officers, the company’s financial status, potential risks to investors, and how investors’ money is used. Attorney General Grewal stated:

The Bureau’s action today reinforces our commitment to protecting investors as they navigate the uncharted and largely unregulated domain of cryptocurrency-related investments. We want to make sure that investors tempted to cash in on the cryptocurrency rage aren’t being lured into sending funds to an anonymous internet entity without knowing where the funds are going or how they’ll be used.

A visit to Bitstrade’s official website indicates that all signs indeed lead to a Ponzi scheme.

The company claims to be registered in the United States and purports to guarantee “outstanding returns” by “working as an investment pool, collecting multiple lower value investments and grouping them into one single HUGE investment, using those funds to trade on the stock market”—without any actual information as to how they use investors money.

BitConnect Sued By 6 Investors Who Lost Over $700K

If it sounds too good to be true, it probably is. According to Sharon M. Joyce, Acting Director of the Division of Consumer Affairs:

What makes Bitstrade’s fraudulent offer potentially more harmful for unsophisticated investors is that cryptocurrency is virtually anonymous, so there is no recourse for investors to recoup their losses. We’re reminding investors to be extra vigilant about fully vetting what is being sold before investing with cryptocurrency.

The Bureau additionally found Bitstrade’s Redland, California and Scottsdale, Arizona addresses to be falsified.

According to Christopher W. Gerold, Chief of the Bureau of Securities, “Bitstrade is a prime example of a company seeking to capitalize on the cryptocurrency craze. Regulators, including the Bureau, are actively responding to fraudulent crypto-cloaked securities offerings.”

Bitstrade requires purchases be made with Bitcoin.

Do you think Bitstrade is a Ponzi scheme? Do you agree that state regulators should actively try to prevent individuals from investing in fraudulent companies? Let us know in the comments below!


Images courtesy of Bitcoinist archives.

Show comments

Share
Úno 10

France & Germany ‘Threatened’ by Bitcoin, Want Global Crypto Crackdown

· February 10, 2018 · 9:45 am

With Bitcoin and other cryptocurrencies finally bouncing back after a steep correction to start the new year, finance ministers in France and Germany are looking to shut down the party by calling for a crypto crackdown.


France and Germany ‘Threatened’ by Cryptocurrency

French and German finance ministers continue to call for strict regulation on Bitcoin and other cryptocurrencies.

According to reports, French Finance Minister Bruno le Maire and interim German Finance Minister Peter Altmaier signed a letter to fellow G20 finance ministers, in which they claim cryptocurrencies are not only risky for investors but also threaten long-term global financial stability. They write:

Given the fast increase in the capitalization of tokens and the emergence of new financial instruments … these developments should be closely monitored.

They also claim that cryptocurrencies “are currently largely mislabeled as ‘currencies’ in the media and on the internet,” creating a “lack of clarity” which “can only fuel speculation.”

Bitcoin Germany

The finance ministers additionally claim to be the good guys, looking out for newbie cryptocurrency investors who aren’t quite sure what they’re getting themselves into, writing:

… the buildup of individual exposures to such volatile tokens could have damaging consequences for misinformed investors who do not understand the risks they are exposing themselves to.

Of course, these sentiments can easily be interpreted as authorities from traditional financial institutions feeling the mounting pressure from a rapidly increasing and ever more popular cryptocurrency market, which very much aims to disrupt traditional financial structures.

FUD, FUD, and More FUD

Finance Minister Bruno le Maire and interim German Finance Minister Peter Altmaier are not alone in expressing fears over Bitcoin and cryptocurrency. Other individuals from traditional financial institutions are also voicing their concerns.

European Central Bank board member Yves Mersch expressed his negative opinion on Thursday, stating that cryptocurrencies are “not money, nor will they be for the foreseeable future.”

ECB EU

Additionally, Bank for International Settlements head Agustin Carstens expressed his deep-rooted fears, begging central banks to shut down Bitcoin—claiming cryptocurrencies are “piggybacking” on established institutions and becoming a “threat to financial stability,” stating:

[Bitcoin is] a combination of a bubble, a Ponzi scheme and an environmental disaster.

Now that’s some serious FUD.

What do you make of French and German finance ministers calling for a global cryptocurrency crackdown? Does this worry from mainstream financial institutions signal their growing fear of Bitcoin? Let us know in the comments below!


Images courtesy of AdobeStock, Shutterstock, Bitcoinist archives.

Show comments

Share
Úno 06

FUD Storm Continues as China Steps Up Pressure Against Cryptocurrencies

· February 6, 2018 · 9:00 am

Following false fears of a Bitcoin ban in India, the FUD storm continues as China looks to completely eradicate cryptocurrency trading—but can they succeed?


Chinese FUD Strikes Again

It’s been a rough month for Bitcoin and the cryptocurrency market. The price of the dominant cryptocurrency has dropped below $8,000, and many altcoins have suffered even more significant losses, following a seemingly endless flood of FUD (Fear, Uncertainty, and Doubt) from mainstream media outlets.

Now, it appears the FUD of the day is that China, already notoriously unfriendly towards cryptocurrency, is ready to block all access to cryptocurrency trading websites and initial coin offerings (ICOs) by utilizing its notorious Great Firewall of China.

China

The troublesome story comes primarily from Financial News, a publication affiliated with the People’s Bank of China (PBOC), which is quoted as stating:

To prevent financial risks, China will step up measures to remove any onshore or offshore platforms related to virtual currency trading or ICOs.

Since then, advertisements for cryptocurrencies have reportedly stopped appearing on both Baidu and Weibo—China’s largest search engine and social media platform, respectively.

Scaling the Wall

Though China continues to be an enemy of cryptocurrency, it remains to be seen whether or not their increased measures have a greater effect than their already-instituted domestic ban.

According to the South China Morning Post, the PBOC-affiliated article admitted that recent attempts to eradicate digital currencies by shutting down domestic exchanges haven’t worked as well as planned, quoting:

ICOs and virtual currency trading did not completely withdraw from China following the official ban … after the closure of the domestic virtual currency exchanges, many people turned to overseas platforms to continue participating in virtual currency transactions. Overseas transactions and regulatory evasion have resumed.

The Financial News’ article also spins the planned ban as being for the protection of the country’s citizens, stating:

Risks are still there, fuelled by illegal issuance, and even fraud and pyramid selling.

China has already banned ICOs and domestic cryptocurrency exchanges, but many eager investors inside the country have found workarounds. According to Donald Zhao, a Bitcoin trader who moved to Tokyo following China’s domestic ban, China’s new regulations might succeed in making it even harder for individuals to circumvent the law:

It is common for people to use VPNs [virtual private networks] to trade cryptocurrencies, as many exchange platforms relocated to Japan or Singapore … I think the new move literally means it would be even harder to circumvent the ban in China … people promoting related business programmes may be arrested.

Still, where there’s a will, there’s a way, and people who really want to trade cryptocurrencies will likely figure out how to do so in secret.

China

Though stricter regulations in China aren’t going to help the market recover any faster, it’s worth mentioning that other countries are set to benefit. According to Cathay Capital’s Ace Yang:

It’s positive news for Japan and Singapore, because demand for participating in trading is not diminishing and traders have got to go somewhere.

What do you think about China’s claim to increase measures against cryptocurrency trading? Do you think it will have any long-term effects, or is it just another case of FUD? Let us know in the comments below!


Images courtesy of Shutterstock, Bitcoinist archives.

Show comments

Share