On Wednesday, WeChat – one of China’s biggest social media networks – closed a handful of crypto-related accounts and accused them of promoting crypto news. Top influencers from the Chinese crypto space had their accounts permanently shut down, while it is expected that more accounts will be closed in the coming days. China had already imposed a blanket ban on crypto trading and exchanges, prompting many to seek refuge in Japan and Malta. However, this new ban appears to be more targeted towards news outlets promoting crypto news and ICOs. Despite the initial trading ban, crypto activity continues to soar in China – so this new measure might well be an attempt to stomp that out.
China Taking Regulation Seriously
Despite the previous clampdown, crypto media outlets continued to thrive – and some even acquired millions of dollars in funding from investors. This time the Chinese government has come after the media outlets, leaving Chinese crypto enthusiasts with only one option left for crypto news – to scale the great firewall of China. This is how every Chinese crypto trader is currently operating, they have to use a VPN in order to bypass the firewall and connect to a crypto exchange. While this means their connection is slow, they can still access crypto sites and enjoy the fruits of Satoshi’s labor.
WeChat Simply Complying with Government Rules
In a statement on its website, WeChat owner Tencent officially confirmed that it had closed down the accounts of crypto news outlets and it urged its users to comply with public orders and national interests. It went on to add, “Users of instant messaging tools serving in public information service activities shall abide by relevant laws and regulations. For instant messaging service users who violate the agreement, the instant messaging service provider shall take measures such as warning, restriction, suspension, and closure until the account is closed, and save the relevant records and fulfill the obligation to report to the relevant competent authority.”
Mining Activities Left Alone – For Now
Chinese crypto mining farms make up the majority of the Bitcoin network hash rate, and this can clearly be seen from the recent flooding that wiped out a Chinese crypto mine. Bitmain is the largest producer of ASIC mining chips – the chips that power crypto mining – and it controls nearly half of the total Bitcoin network hash rate alone. The fact that the Chinese government has left the mining industry alone raises some questions. Perhaps the government is receiving kickbacks from mining farms like Bitmain, or they enjoy controlling most of the crypto world’s hash rate. For now at least, crypto mining in China continues to thrive.
Bitmain has an IPO in the works, this indicates that the crypto mining industry in China is still free to operate and expand for the foreseeable future.
China Could be Preparing Regulations in Secret
The recent crackdowns could simply be a way to stifle news about the Chinese government’s plans to create its own crypto regulations. These new regulations that could be in the works could change the way the country interacts with cryptocurrencies and blockchain technology. If China was to approve a series of crypto regulations, it would soon become a hotbed of activity and spur the industry on. However, privacy is something the Chinese government enjoys, and the fact the DEA has said it can trace any transaction made with any crypto could have scared the government.
While the government hasn’t yet said why it is clamping down on crypto activity harder than ever before, there is a good chance it has something to do with upcoming crypto regulations. Crypto regulations would be welcomed in China, as it could make the country the perfect location for many crypto businesses to open a base.
