China has officially banned the trade of crypto-currencies, after it announced that it planned to put in place a regulation in September. All transactions of digital currencies have been arrested since the 1st of November. With the closing of the market of crypto-currencies, exchanges of virtual currency, are officially become illegal.
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Moreover, this does not mean that chinese investors are not involved in the market of crypto-currencies, only that they have been forced to turn to other countries to develop their activity.
The companies of trade of crypto-currencies are moved abroad
To be able to continue their activity, professionals in the sector have been forced to close their companies in China and to continue their operations in other countries. Huobi, one of the three main companies in the exchange of Bitcoin, moved to Singapore, Hong Kong and South Korea, confirms the report of Forbes.
BTCC, another great company that previously had its headquarters in Shanghai, is planning to charge users a service fee to remove the existing funds as a result of this prohibition.
The ICO are also prohibited
China has not only allowed the exchange of crypto-currencies. Government regulators have also closed the market of the ICO. This was a hard blow for the companies developing the crypto-currencies. Yet, chinese investors could use the ICO using accounts offshore. C2CX has indicated that the ban chinese should not have any impact on the development of the market of digital currencies. The CEO of C2CX, Scott Freeman, said that no company based in China has not ceased its activities, they have simply moved their headquarters abroad.
Despite the prohibition of the trade of crypto-currencies and ICO, the chinese government indicated that it would continue to explore the developments of technology Blockchain. In the Face of this decision, could we expect a decline of the value of digital currencies ?
Source : InvestOpedia