Over 100 Cryptocurrency Offshore Exchanges Face The Heat of Chinese Regulatory Crackdown

It looks like China is going to ban anything and everything under the sky related to cryptocurrencies. According to the local publication Shanghai Security Times, the Chinese regulatory authorities are planning to block 124 off shore cryptocurrency exchanges which can be accessed from the Chinese homeland.

This move looks like an attempt to block Chinese investors from being a part of the global cryptocurrency market under any circumstances. The publication did not state any specific reason behind this clampdown but suspects that it could be possibly due to the growing concerns of the financial stability in the country.

Post this, a warning was issued on Friday, August 23, by five high-level watchdogs targeting foreign-based projects trying to lure Chinese investors to participate in crypto trading activities.

In the warning, the regulatory authorities quoted: "Some of these projects tap celebrities and airdrop 'candies' as ways for promotion and solicitation. ... In fact, they manipulate the prices of such cryptocurrencies to make profits illegally. Some individuals claim in chat groups on messaging applications that they are able to invest in overseas crypto projects on behalf of domestic investors as a broker. ... These claims are highly likely to be fraudulent.”

The regulators have also warned Chinese locals for indulging in other ICO-like fundraising methods like "initial fork offerings”, "initial exchange offerings”, and initial miner offerings” - calling them as means to speculate digital currencies.

This news just a few days after the Chinese regulatory authorities asked local crypto media outlets to shut down their official WeChat account. These media outlets were allegedly charged for creating hype for digital currencies among local Chinese people that could result in further market manipulation.

WeChat’s parent operator - Tencent - said that it has shutdown the accounts of these media outlets permanently as they are “suspected of publishing information related to ICOs [initial coin offerings] and speculations on cryptocurrency trading.”

Additionally, payment applications like WeChat Pay and Alipay have completely removed the crypto payment services from their platform in order to comply with the newly introduced regulatory guidelines.

WeChat parent Tencent said that they will be closely monitoring daily transactions along with the risk assessment of any suspicious crypto-related transactions. Another local publication Beijing News quoted Alipay operator Ant Financial saying: "All along, Alipay will resolutely retreat for merchants involved in virtual currency transactions; for personal accounts suspected of virtual currency transactions, according to the circumstances, resolutely take measures to limit account collection or even permanently limit collections.”