China Never Completely Banned Crypto

Despite Government Crackdowns and Widespread Reports

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In late September 2021, the People's Bank of China (PBOC) banned all cryptocurrency transactions. This sent shockwaves through the global crypto community, as China is one of the largest markets for digital assets. However, a closer examination of the PBOC's announcement reveals that it does not constitute a complete ban on cryptocurrencies in China.

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The PBOC's ban specifically targets cryptocurrency transactions, but it does not prohibit the ownership or possession of cryptocurrencies. This means that Chinese citizens are still allowed to hold cryptocurrencies in their personal wallets, and they can still trade cryptocurrencies on decentralized exchanges.

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China's hostile stance regarding crypto dates back to December 5, 2013, when the PBOC issued a notice banning financial institutions from providing services related to cryptocurrencies. However, this ban was not strictly enforced, and many Chinese citizens continued to trade cryptocurrencies on unregulated exchanges.

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China joins a growing list of countries where cryptocurrencies are banned or restricted. In May, China banned financial institutions and payment companies from providing services related to cryptocurrencies. This ban was followed by a crackdown on cryptocurrency mining, which led to the closure of many mining operations in China.

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China's central bank has announced that all transactions of cryptocurrencies are "illegal financial activities." This ban is likely to have a significant impact on the global crypto market, as China is one of the largest markets for digital assets.