About two dozen cryptocurrency firms have fled the country after PBOC explicitly warned foreign platforms about providing services to its citizens, calling them illegal financial activities.
In less than fifteen days since the People’s Bank of China issued new regulations to crack down even more strongly on the cryptocurrency industry in the country, more than 20 such companies have stopped providing services to users in China or have completely withdrawn from the Chinese market, according to a local report.
On Friday, the National Development and Reform Commission further added virtual currency mining back to its outdated industry category; an action expressed in the PBOC’s notice last month.
The NDRC first started publishing this industry reform catalog in 2005 and grouped industries into three categories to encourage, restrict or eliminate them.
According to the latest draft, crypto mining is an industry that uses outdated production processes and equipment.
This time the central bank has strengthened its regulations against crypto and explicitly warned foreign platforms about providing services to Chinese citizens, declaring them illegal financial activities.
The campaign has served as a “clearer signal to the cryptocurrency industry that the space for relevant institutions and professionals is being squeezed more and more,” said Su Xiaorui, a senior analyst at research firm Analysys.
Today, Justin Sun’s Poloniex exchange announced that it will cease its operations in mainland China as it cannot comply with the local laws only to inform later that their “last email was wrong.”
In its first email, Poloniex had said that the platform would restrict its operations from 7th October, 4:00 am (UTC), and that it had stopped its registration facilities on 4th October.
Leading crypto exchange Binance swiftly stopped registering new mainland Chinese users following PBOC guidelines. Another popular crypto exchange Huobi said it would phase out access to existing Chinese users by this year’s end, and earlier this month, it yet again issued an announcement confirming the details of the withdrawal of users in China.
This week, Huobi COO Zhu Jiawei further announced his exit from the company. Founder and chairman Li Lin clarified in a WeChat post that their COO had already quit in April, but they delayed publicizing the information to avoid negatively impacting the company. Binance’s chief financial officer Zhou Wei also left the company in May.
However, both the exchanges were already forced to move out of China in 2017 when Beijing stopped hosting fiat to crypto transfers. But until this year, Chinese users were still able to access those services through over-the-counter (OTC) services and crypto-to-crypto transactions.
No More Support
Other platforms like TokenPocket, BitMart, and BHEX have also stopped providing their services to Chinese users.
Miners like SparkPool, which is one of the largest Ethereum mining pools and data providers, have all fled China as well. Alibaba has banned the sale of crypto mining equipment, NBMiner, which develops management software for graphics cards, is no longer offering tech support to users in China, and the operator of the Feixiaohao app also ceased its operations in the country.
Even HyperDAO, which offers decentralized financial (DeFi) services, said it would no longer discuss cryptocurrency on Chinese social media and had quit all business on the mainland.
Major data aggregators CoinGecko, CoinMarketCap, and TradingView, are no longer accessible in mainland China either.