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Cryptocurrency exchanges forestall Chinese language customers from logging in after crackdown

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

Budrul Chukrut | SOPA pictures | LightRakete | Getty Images

GUANGZHOU, China – Huobi, one of the world’s largest cryptocurrency exchanges, said it stopped opening new accounts for Chinese users in the mainland after Beijing cracked down on virtual currencies again.

The People’s Bank of China on Friday declared all virtual currency-related activities, including trading, to be illegal. The Central Bank of China also targeted overseas exchanges that provide services to users in mainland China.

Huobi, one of those exchanges, announced on Sunday that it would cease account registration for new users in mainland China. The company will also gradually withdraw existing accounts of users in mainland China by midnight on December 31, 2021.

Meanwhile, Binance, one of the world’s largest cryptocurrency exchanges, said account registrations with Chinese cell phone numbers are now being blocked. The Binance app is no longer available for download in China either.

“Binance takes its compliance obligations very seriously and is committed to following the requirements of local regulators wherever we operate,” a spokesman told CNBC.

This year, Chinese authorities have stepped up crackdown on cryptocurrencies targeting bitcoin miners and trading.

But China’s tough stance on cryptocurrencies isn’t new. The authorities of the world’s second largest economy have long been concerned about the impact of digital coins on financial stability.

In 2017, China closed local cryptocurrency exchanges and banned Initial Coin Offerings (ICOs), a way of raising money for crypto companies by issuing digital tokens.

Many of the Chinese cryptocurrency exchanges therefore relocated abroad. However, loopholes have remained that allow traders in mainland China to buy and sell digital currencies on these offshore exchanges.

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