Is this bad news for immigrants and will other countries follow China’s example?
It is now illegal to trade Bitcoins in China. The China central bank announced that all financial transactions involving cryptocurrencies are illegal, sounding the death knell for digital currencies in China.
The global values of cryptocurrencies including Bitcoin have massively fluctuated over the past year partly due to Chinese regulations, which have sought to prevent speculation and money laundering.
“Virtual currency-related business activities are illegal financial activities,” the People’s Bank of China (PBOC) said in an online statement Friday, adding that offenders would be “investigated for criminal liability in accordance with the law.”
The notice bans all related financial activities involving cryptocurrencies, such as trading crypto, selling tokens, transactions involving virtual currency derivatives and “illegal fundraising”
The central bank said that in recent years the “trading and speculation of Bitcoin and other virtual currencies have become widespread, disrupting economic and financial order, giving rise to money laundering, illegal fund-raising, fraud, pyramid schemes and other illegal and criminal activities.”
In June, Chinese officials said more than 1,000 people had been arrested for using the profits from crime to buy cryptocurrencies.
Several Chinese provinces had already banned the operation of cryptocurrency mines since the start of this year, with one region accounting for eight percent of the computing power needed to run the global blockchain.
Bitcoin values have since tumbled at the latest ban. But then, Bitcoin is no stranger to controversy.
The king of Bitcoin is in Africa.
What else is happening in the rest of the Bitcoin world?
Nigeria, Africa’s largest economy is the king of cryptocurrency. In Nigeria, 32% of respondents — nearly 1 in 3 — report having used or owned one type of crypto or another in 2020. Nigeria’s unique culture and circumstances are fueling the trend. One of the biggest influencers is poverty, a condition suffered by 87 million of Nigeria’s 200 million people — and crypto transactions are cheap.
The reason for the trend is that Nigerians are much more likely to make payments and send money using their phones. Finally, double-digit inflation is the rule, not the exception, in Nigeria, and cryptocurrencies like Bitcoin, which are capped to a finite number of coins, serve as a hedge
The USA however remains the world headquarters of Bitcoin and more than $1.52 billion worth of Bitcoin was traded on U.S. crypto exchanges in 2020. That’s more than three times more than the No. 2 country, Russia, which traded over $421.38 million.
There are now more than 300 million cryptocurrency users across the world. Despite the latest China ban latest China ban, Bitcoin is not going away anytime soon.