China’s Crypto Crackdown Intensifies With New Mining Ban And Censorship—But Bitcoin Is Rallying

Top line

China’s crackdown on cryptocurrencies, which crashed markets last month, intensified on Wednesday when another province ordered all crypto mining operations to be halted just hours after popular internet companies began searching for three of the largest crypto -Censor stock exchanges in the country, but Bitcoin prices skyrocket after the historic adoption measure – in the hope that other countries will follow suit.

In view of Chinese regulatory concerns, Bitcoin prices will rise on Wednesday amidst historic … [+] Adoption in El Salvador.

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Important facts

On Wednesday, China’s Qinghai became at least the third province in the country to take steps to curb cryptocurrency mining operations due to environmental concerns, prevent local officials from setting up or approve crypto mining projects, and ordering the provincial government on enforcement measures to be informed by June 20th.

In its announcement, the province said it would conduct follow-up inspections at randomly selected supercomputing centers to ensure compliance and punish anyone who violates the ban.

The decision came after early morning reports that Baidu, the country’s most popular search engine, and social media site Weibo began blocking searches on the OKEx, Huobi and Binance cryptocurrency exchanges, which is the largest in the world by volume.

“According to applicable laws and regulations, the results of this search are not available,” reported users when they searched for any of the exchanges on Weibo.

Despite Chinese regulatory concerns that crashed crypto markets last month, tokens largely rebounded on Wednesday afternoon, with Bitcoin prices soaring 12% in the past 24 hours as investors El Salvador’s successful vote praised making the world’s largest token a form of legal tender.

Crucial quote

“Some larger, more powerful countries are trying to halt or slow down the inevitable move to borderless digital currencies, but this small Central American nation has embraced the largest of them all,” said Nigel Green, CEO of $ 12 billion wealth advisor DeVere Group wrote in a Wednesday note. “El Salvador made history and we can expect other developing countries to follow suit.” Other Latin American countries have already indicated their support for similar implementation measures

Key background

Last month, with a series of warnings targeting trading and mining, Chinese officials sparked concerns that crashed the crypto market. Mai, three Chinese industry groups overseeing the financial sector announced that given the volatility of the market, the country would take action against financial institutions that conduct cryptocurrency businesses or provide related services, saying digital tokens have “no real support value” and prices that “extremely easy” to manipulate. The following week, Beijing said it would “curtail bitcoin mining and trading activities” in an attempt to achieve financial stability by curbing the spread of cryptocurrencies. In addition to Qinghai, two other provinces – Inner Mongolia and Sichuan – have since announced measures to restrict or ban mining. The markets fell about 30% on the warnings and have since gained about 15%.

tangent

The cryptocurrency market slumped more than 10% in mid-April after power outages in China led to massive declines in bitcoin mining rates, which experts believe are correlated with prices. Those rates have since rebounded, but around 75% of the world’s mining takes place in China, meaning widespread bans could shake the market again.

further reading

El Salvador is making history as the first country in the world to create Bitcoin as legal tender (Forbes)

China Takes Crypto Business, Says “Speculative” Trade “Seriously Violates” Financial Regulations (Forbes)

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