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Cryptocurrency exchanges stop Chinese users signing up after crackdown


In this photo illustration, the Bitcoin logo is seen on a mobile device with People’s Republic of China flag in the background. (Photo Illustration by t/SOPA Images/LightRocket via Getty Images)

Budrul Chukrut | SOPA Images | LightRocket | Getty Images

GUANGZHOU, China — Huobi, one of the world’s largest cryptocurrency exchanges, said it has ceased new account openings for mainland Chinese users after Beijing renewed a crackdown on virtual currencies.

The People’s Bank of China declared all virtual currency-related activities illegal including trading on Friday. China’s central banking also targeted overseas exchanges offering services to users in mainland China.

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Huobi, one of these exchanges, said on Sunday that it would end account registrations for new mainland Chinese users. It will gradually close existing accounts belonging to mainland Chinese users. This is expected to happen by midnight Dec. 31, 2021.

Binance, one among the most popular cryptocurrency exchanges worldwide, stated that account registrations using Chinese numbers for mobile phones are currently blocked. Binance’s app cannot be downloaded in China.

CNBC spoke with a spokesperson for Binance. She stated that the company takes compliance very seriously. Binance is also committed to complying with local regulations wherever it operates.

This year, Chinese authorities have intensified a crackdown on cryptocurrencies that has targeted bitcoin miners and trading.

China’s toughstance regarding cryptocurrencies has been around for a while. The authorities of the second largest economy in the world have been concerned about the financial stability impact of digital currencies for years.

In 2017, China shut down local cryptocurrency exchanges and banned so-called initial coin offerings (ICOs), a way to raise money for crypto companies by issuing digital tokens. 

As a result, many of China’s cryptocurrency trading platforms moved overseas. But loopholes have remained that allow mainland Chinese traders to buy and sell digital currencies on these offshore exchanges.