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Crypto Airdrops | Crypto Ban in China Spreads to Airdrops

China does not like cryptocurrency. The country has repeatedly imposed strict sanctions against its use and relative businesses. Now the central bank of China is adding to its list by banning crypto airdrops.

China Bans Crypto Airdrops After ICO Abhorrence

The People’s Bank of China, or PBoC, has classed token airdrops as “disguised” Initial Coin Offerings (ICOs). It detailed its new scrutiny in a financial stability report, published on Friday, November 2nd.

The bank’s regard for crypto airdrops echoes its abhorrence of ICOs, describing them as “illegal” fundraisers that lead to financial fraud, pyramid schemes, and hacks.

Now Crypto Airdrops Are Banned

The PBoC believes that crypto airdrops are evading regulation by giving away free assets to investors. According to Cointelegraph“airdrops earmark a token reserve and then capitalizing on speculation in the market to inflate the assets’ value and drive their own profits.”

And despite the bank’s continuous efforts to crack down on token issuance, ICOs and crypto airdrops are on the rise. It is calling for a doubled vigilance on the part of regulators to better protect investors.

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The document continues further hitting out at most aspects of the cryptocurrency industry. It is concerned about Chinese crypto companies moving abroad and using foreign “agents” to invest on behalf of Chinese citizens. It also warns against whitepapers and investment projects calling themselves “blockchain innovation.”

The overall fear is for crypto’s ability to evade capital controls and international sanctions. By encouraging a system of finance that lies outside of government control, PBoC feels money laundering, tax evasions, and illegal financing will result and impact society.

China has Never Warmed to Crypto

China has been stringent in its rules forbidding cryptocurrency. It placed a ban across crypto-to-fiat trading since September 2017, and the effect of that has been felt across the market. It has also officially blocked all websites related to cryptocurrency both domestic and foreign.

As the PBoC said previously, “to prevent financial risks, China will step up measures to remove any onshore or offshore platforms related to virtual currency trading or ICOs.”

Crypto airdrops are the latest victim of China’s firm hand on cryptocurrency.

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Japanese Cryptocurrency Exchanges Can Now Police Themselves

Japanese cryptocurrency exchanges have been given full license to create their own regulations.

So what’s going on?

Japanese Cryptocurrency Exchanges

Earlier today, the country’s financial regulator, the Financial Services Agency (FSA), granted the Japan Virtual Currency Exchange Association (JVCEA) a self-regulatory status.

The JVCEA is made up of 16 licensed and domestic crypto exchanges. Its members are Bitflyer, Money Partners, Bitbank, Bitpoint, Quoine, SBI Virtual Currencies, Fisco Virtual Currency, Btcbox, Zaif, GMO Coin, Bittrade, Tokyo Bitcoin Exchange (DMM Bitcoin), Bitarg Exchange Tokyo, FTT Corporation, Xtheta Corporation, and Bitocean.

The FSA has declared the body as a “certified fund settlement business association.” With this new status, it puts regulation responsibility in JVCEA’s hands. The body can now police its own exchanges.

Japan’s Cryptocurrency Exchanges

JVCEA can now implement its own rules and guideline for domestic crypto trading. In doing so, it can create measures to protect customer assets and improve security, whilst also curtailing insider trading, theft, and money laundering.

And this is exactly what the body was created to do; to regulate, protect, and give legitimacy to an industry that has suffered major hacks.

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Accreditation for Japanese Crypto Exchanges

In August, JVCEA submitted an application to the FSA to become an accredited body. After two months and a rigorous reviewing process, it is now an officially recognized body. The financial regulator had to “carefully examine the affairs of the Association and investigate whether proper group management can be expected.”

Now Japanese cryptocurrency exchanges can move forward and take control of the industry. JVCEA has already begun enforcing new rules effective immediately. The body has created a 100-page document with rule proposals. One example is a complete ban on privacy coins such as Monero and Dash from licensed exchanges. Another is a limit on margin trading with crypto.

JVCEA said on the news:

“With the acquisition of the accreditation, we will continue to make further efforts to create an industry that you can trust from everyone who uses virtual currency with members [exchanges].”

Japan’s crypto exchanges have been reeling from massive hacks. Notable thefts include January’s $530 million theft from Coincheck and the more recent Zaif exchange heist.

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Cryptocurrency in India | RBI Bitcoin Ban Hears Final Petitions

Cryptocurrency in India is becoming a hot topic thanks to the upcoming crypto hearings in the country. India’s Supreme Court is set to listen to the final round of petitions against the country’s Bitcoin ban. The ban was put in place by the country’s central bank, the Reserve Bank of India (RBI). The hearing is set to happen today, September 25th, local news outlet The Financial Express reports.

Reserve Bank of India (RBI) Bitcoin Ban

In April, the RBI asked regulated entities to not get involved with businesses, firms, or individuals that traded cryptocurrency, imposing a virtual ban. At the time, interest in cryptocurrency in India had dropped compared to the previous year, but that seemed more due to a global drop in interest in digital currencies.

The RBI imposed its ban on cryptocurrencies in early July. The RBI ban was then challenged by the domestic cryptocurrency exchanges in the Supreme Court.

The original hearing on this matter was scheduled on September 11th, but due to the court’s backlog, the hearings were rescheduled—twice. On September 12th, the RBI maintained its views on the Bitcoin ban by telling the court that no legal system defines cryptocurrencies in their current format.

“The petitioner cannot seek to exercise the extraordinary jurisdiction of this Honorable Court to avail a right which they do not have,” the Indian central bank wrote in its affidavit. “The impugned circular and the impugned statement have been issued in a manner that is consistent with the powers conferred on the RBI by the law and the same are legal and valid.”

>> India Crypto Regulations

Cryptocurrency in India began to flourish last year, as the crypto market began rising at monumental rates after Bitcoin started breaking into mainstream media. In a month’s time, the total cryptocurrency market lost $500 billion. This scared regulators across the globe and many began implementing laws against the digital currencies.

This may be the case for the RBI, as it saw its residents take such an interest in the emerging currencies, only to see them fall drastically months later.

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China’s Ban on Crypto Continues

China’s ban on crypto continues across the country as the Guangzhou Development District is next to be hit.

What’s going on?

China’s Ban on Crypto Continues

Last week, a very similar ban was imposed in Beijing’s Chaoyang district, whereby venues were handed out fliers detailing a prohibition against commercial venues hosting crypto-related events. Venues such as hotels, bars, and clubs were targeted.

Now today, local media outlet Jiemen has reported that the same ban has been extended to the Guangzhou Development District—a special economic zone in southern China, close to Hong Kong.

The reason given for the ban is the need to “maintain the security and stability of the financial system.”

China is Clamping Down

It’s too early to foretell the ramifications of these bans, but if we look at China’s recent actions toward cryptocurrency, the superpower is really trying hard to further clamp down on the digital assets. 

>> Bithumb Will Re-open Account Registrations!

ICOs and crypto trading are high on the list of crackdowns:

  • WeChat, the massive social messaging platform, just over a week ago, blocked several high-profile crypto- and blockchain-related accounts, accusing them of promoting cryptocurrency that violated recently implemented regulations. Subsequently, WeChat’s operator, Tencent, went further, announcing a total ban on crypto trading.
  • Major Chinese search engine, Baidu, also closed several crypto-related chat forums suddenly. It stated it was doing so “in accordance with relevant laws, regulations and policies.” However, Baidu has been a fan of blockchain technology all the same.
  • Chinese e-commerce giant Alibaba also clamped down on crypto trading through its subsidiary companies, by restricting and/or banning accounts affiliated with crypto-trading. The retailer has been notoriously contradictory in its approach to crypto though.
  • Also last week, the People’s Bank of China issued an alert against “illegal” ICOs. It warned that “financial innovation” was simply fraudulent schemes and gimmicks dressed up. Again though, the bank had only recently filed for a digital currency wallet, so this remains a little skeptical.

China has placed a ban across crypto-to-fiat trading since September 2017 and the effect of it has been felt across the market. The country officially blocked all websites related to cryptocurrency both domestic and foreign and the People’s Bank of China said that “to prevent financial risks, China will step up measures to remove any onshore or offshore platforms related to virtual currency trading or ICOs.”

It doesn’t look like China is easing its stance anytime soon. What district will be next to receive the event ban, I wonder?

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China Banning Cryptocurrency Events | Further Bans Expected

Why is China banning cryptocurrency events? The country has put in place a ban on venues hosting all events related cryptocurrency in the Chaoyang district of Beijing.

China Banning Cryptocurrency Events; What’s Going On?

The report comes from the local news outlet, The Paper, which states that all public spaces have been prohibited from hosting cryptocurrency-related events. This includes shopping malls, office buildings, and hotels, where documents detailing the ban were issued.

Restrictions

Japanese media also reports that these new restrictions coincide with other measures targeting communication channels used by Chinese investors to gain access to ICOs.

Reasons given to justify the measures include the “protection of public property rights,” along with the upholding of “the security and stability of the financial system,” and the “prevention of money laundering.”

Blocking Access

The China National Fintech Risk Rectification Office has identified 124 crypto trading platforms with overseas IP addresses and is intending to block access to their services, according to the Shanghai Securities Times. And recently, WeChat — a popular social media platform in the country — permanently blocked a number of crypto and blockchain-related accounts, including Jinse.com, News Flash, TokenClub, Coindaily, Huobi News and Huobi Research Institute, BiShiJie, deepchain, Wujie Blockchain, and Dapao.

Tell On Thy Neighbour

Members of the public have been encouraged to call out and publically denounce any violations of the ban. There are concerns that the ban could be extended to other districts in China.

>>Despite its Hack, Bithumb Made $35 Million in Q1 and Q2 of 2018

China Is Clamping Down

China banned Bitcoin-to-fiat exchanges along with ICOs in September 2017, and since then has been clamping down on crypto-related activity with greater authority and persistence. Further new measures are underway to bolster the so-called ‘clean-up’ of third-party crypto payment channels, according to CT Japan.

Officials from China’s Office for Special Remediation of Internet Financial Risks will reportedly interview third-party payment institutions and order them to cease any cryptocurrency-related dealings. In June, China declared victory over cryptocurrency trading by claiming that just one percent of Bitcoin transactions are made using local currency.

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