The hostile crypto environment in China caused more than 20 local companies to move out of there

More than 20 Chinese crypto-related businesses revealed that they would suspend operations and withdraw from the local market as the country continues its hostile stance towards any cryptocurrency.

The impact of China’s crypto ban is bigger than we thought

China’s hostile stance towards the crypto industry has been known for many years, and local authorities regularly remind investors of this. The country’s central bank published a document indicating that trading and mining digital assets are prohibited within China’s borders at the end of September. It also bans people from operating with such exchanges.

Soon after, many crypto-related companies started closing their businesses. According to China Securities Journal, these institutions are more than 20 because they will stop providing services and move abroad.

Speaking of such institutions, it is worth noting that the intensification of the ban caused the major exchange – Huobi – to suspend new user registrations from China. A few days later, one of the largest Bitcoin pools – Huobi Poll – transferred over $4 billion in BTC from miners. This is the largest cash flow since December 18, 2017.

China’s crackdown also comes to Sparkpool. Last week, the second-largest ETH mining pool announced that it was suspending access to new users in Mainland China and giving up all of its services as of September 30.

On top of that, the Chinese government has seized mining equipment in the northern province of Inner Mongolia, marking the 45th seizure in that province.

Although the government of the most populous country has redoubled its efforts to block all possible crypto activity inside its borders, bitcoin has ultimately resisted the attacks. In fact, as of the time of writing this, the asset’s price is sitting at around $54,500, up about 25% since the People’s Bank of China’s latest ban.

Cryptocurrency mining makes up one of the 117 industries restricted or prohibited by the negative list. The National Development and Reform Commission said that the total is down from 123 industries on the 2020 list.

Cryptocurrency crackdown In China

The Chinese government officially banned cryptocurrency trading in 2019, although it continues to be online through foreign exchanges. However, there has been a significant crackdown this year.

China is one of the largest cryptocurrency markets in the world. With the crackdown, investors and exchanges began to retreat. China’s crackdown also affects the mining industry. The country is one of the world’s top mining hubs because of the relatively low cost of electricity and cheaper computer hardware. In September 2019, China accounted for 75% of Bitcoin energy use in the world. By April 2021, that number had dropped to 46%.

In May, Chinese state intuition warned buyers that they would not be protected if they continued to trade Bitcoin and other currencies online, as government officials vowed to increase the pressure on the industry. In June, it asked banks and payment platforms to stop facilitating transactions. It also enacted a ban on mining digital currencies.

Last month, the People’s Bank of China and several other agencies made all cryptocurrency transactions illegal. The country’s central bank vows to purge “illegal” crypto activities. The significant exchanges then began to cut ties with their Chinese users.

After China’s crypto ban, the price of Bitcoin and other currencies dropped significantly. However, it recovered quickly. At the time of writing, Bitcoin is trading at over $55,000.

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