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WeChat Shuts Down Crypto Trading as China Continues with Crypto Ban

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Tue, 05/07/2019 - 14:20
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Yuri Molchan
The Chinese messaging service powered by Tencent has changed its policy to prohibit merchants from conducting any financial activities related to crypto
WeChat Shuts Down Crypto Trading as China Continues with Crypto Ban
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On April 30, WeChat made adjustments to its payment terms protocol. From now on, merchants that have accounts on the app are forbidden from conducting any activities that involve digital coins or ICOs. Details were shared by CoinDesk.

No crypto trading on WeChat

The situation seems to be the continuation of the Chinese ban on ICOs and digital currencies which began in 2017.

The new policy on WeChat becomes valid on May 31. All merchants will be banned from conducting any crypto-related payments. Those who do will be forbidden from using any payment services on the platform at all.

A blow against OTC crypto traders

Another action against the crypto industry initiated by WeChat seems to be targeted at OTC crypto traders.

Since WeChat is the most popular messaging app in China, a great number of these traders use WeChat for transferring the local fiat currency to Huobi and OKEx exchanges. These two platforms offer provide venues for OTC trading to swap Chinese yuan for crypto and the other way around.

This is the second phase of the crypto ban placed by WeChat and Ant Financial (an affiliate company of Alibaba) on crypto traders on the messaging app. The initial ban was initiated in late summer last year.

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China plans to shut down local Bitcoin mining

Not long ago, U.Today reported that the major state agency in China, the National Development Reform Commission (NDRC), has suggested the total prohibition of crypto mining in the country.

The agency claims that mining takes too much electricity, therefore, it is an industry harmful to the environment.

Since a great part of overall Bitcoin mining pools is located in China, this could present a harsh blow against the crypto market, BTC in particular, bringing down the network’s hash rate.

Still, many observers stay optimistic, believing that other miners will pop up fast, eager to take the new vacant places in this still profitable business.

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About the author

Yuri is a crypto journalist interested in technology and technical innovations. He has been in crypto since 2017. Believes that blockchain and cryptocurrencies have a potential to transform the world in the future in many of its aspects. ‘Hodls’ major cryptocurrencies and has written for multiple crypto media outlets. 

His articles have been quoted by such crypto influencers as Tyler Winklevoss, John McAfee, CZ Binance, Max Keiser, etc.

Currently Yuri is a news writer at U.Today and can be contacted at yuri.molchan@u.today.