China’s largest social media platform, Weibo, made a significant move on the 5th of September, announcing the closure of 80 illegal cryptocurrency-related accounts. This decisive action was taken to align with the Chinese government’s strict cryptocurrency policies and to combat speculative trading in the country.
In an official statement, Weibo expressed its commitment to corporate responsibility and compliance with the regulatory framework established by the People’s Bank of China Act. The company revealed that it would intensify efforts to identify and address illegal virtual currency speculative transactions and related accounts, employing both internal investigations and user reports as part of the process.
Among the accounts that Weibo closed were some with substantial followings, including one account with a staggering 1.91 million followers and 24 others with more than 100,000 followers. This move signifies Weibo’s willingness to enforce the cryptocurrency regulations rigorously, regardless of an account’s popularity or influence.
The decision has not been without controversy. Some Chinese netizens have expressed regret over Weibo’s actions, with one user stating, “A significant number of people who were with me six years ago were removed. Everyone go to Twitter. ‘Weibo is no more,’ he claimed.” This reaction reflects the divide in public opinion on cryptocurrency regulation in China, with some advocating for stricter controls while others lament the loss of access to cryptocurrency-related information and communities.
This recent crackdown on cryptocurrency-related accounts follows a series of regulatory moves by Chinese authorities. In October 2021, ten Chinese ministries, including the People’s Bank of China, jointly issued a ‘Notice on Preventing and Handling the Risks of Exaggerated Advertising in Virtual Currency Transactions.’ This notice explicitly defined business activities related to virtual currencies as illegal financial activities.
Weibo and other major Chinese platforms had previously taken action against cryptocurrency-related accounts in August of the previous year, closing down approximately 12,000 such accounts. These steps underscore the Chinese government’s commitment to maintaining control over the cryptocurrency market and preventing speculative trading.
Interestingly, these actions come in the wake of Chinese President Xi Jinping’s recent praise for blockchain technology. Just one day prior to Weibo’s announcement, President Xi emphasized China’s dedication to developing the digital economy and promoting the integration of digital technology with the real economy. He also stressed the need to build a “Digital China.”
Simultaneously, while cracking down on cryptocurrencies, the Chinese government has been actively promoting its central bank digital currency (CBDC). Since 2020, China has been conducting CBDC tests in over 12 cities, including Beijing, Shanghai, Pozhou, Xiamen, and Guangzhou. This initiative culminated in the inclusion of the digital yuan in M0 (base currency, cash in circulation) in January of this year.
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