The sudden crypto-crackdown in China has started giving the first tremors to the already crippling digital financial sector of the economy. While giving a major shock to the digital currency arena in the country, at least five local crypto trading exchanges have shut-stop their operations and have affirmed to put an end to offering their services to the native users from this month.
The unfavorable step taken by the trading exchanges is in response to the stringent warnings and notices released by the Chinese regulatory authorities in accordance with their swipe out mission of digital currency trading practices.
Interestingly, the Chinese regulatory authorities have pumped up their game by increasing the scrutiny checks on the huge cryptocurrency marketspace that breathes in the country weeks after President Xi Jinping triggered a market rage by breaking the news about Beijing’s support for the blockchain technology arena. However, the financial regulators have given crucial warnings to investors and cryptocurrency firms to be attentive while dealing with cryptocurrencies. Weibo, a Twitter-like service platform based in China, closed accounts operated by globally reputed cryptocurrency exchanges Binance Holdings Ltd. and leading blockchain-based network, TRON.
The recent crypto cleanup hovering in the Chinese economy is undoubtedly the biggest operation since the Chinese clampdown in September 2017. Though, there was a ban on the exchanges that dealt with Bitcoin and Ether, over-the-counter platforms still managed to facilitate the proliferation of this sector in the country. But, now, even such platforms have restricted themselves because of the constant measures taken by the regulators. This week Bitcoin plunged to its lowest mark in the past six months span. It recovered with a rebound of 6% on Wednesday but still is bound to have its worst month since November last year.
According to the stats from Chainalysis, twenty crypto exchanges from the best 50 hail from the Asia-Pacific region and were responsible for nearly 40% Bitcoin transactions in the first half of the year. The research firm stated that within the region, most of the trading platforms are in China.
Chinese exchange platforms Bitsoda and Akdex revealed last week about the halting of their service operations. November saw the termination of services by Rival Bliss. On Monday, Btuex revealed that it would put an end to its operations because of the Chinese government warnings and orders. It also stated that it might return to business in the future only for overseas investors. Idax, on Sunday, broke the news about the stoppage of its working in the country.
The current uncertainty has triggered the investors to move their funds to reliable sources. Tether, a U.S-dollar pegged stablecoin is becoming a hot-shot solution for the people. ImToken, one of the biggest wallet platforms revealed that the Tether transactions had shown a rise to $66 million mark on November 22. This figure is more than two times the app’s average daily Tether trading activities in October.
Justin Sun, the spearhead of the TRON network stated that “The current situation and environment for blockchain in China is still very positive. In the short term, it may not get as much progress as we’d expect.”