According to the Chinese government, the apparent rise of virtual currency trading has disrupted the country’s overall financial and economic order, springing forth and seemingly encouraging several illicit activities such as pyramid scheming, money laundering, illegal fundraising, and fraud.
The Chinese government argues that the best plan of action right now is to ban its use downright to mitigate further risks concerning cryptocurrencies.
As per the notice handed down by the government, virtual currencies do not possess the same legal status as other legal currencies in the country. The notice also made it a point to reiterate that crypto trading in China is against the law and has been so for several years now.
In light of that reaffirmation, the government now calls for improved risk monitoring protocols and hastened reporting of any virtual currency trading activities.
The crypto industry’s total market capitalization took a hit following this seemingly heavy announcement by the Chinese government against all virtual currencies. As per the latest reports, the industry’s total market cap suffered a 5% decrease, while almost all existing cryptos dipped simultaneously.
For example, Bitcoin (BTC) went down by about 4.2% following the announcement. At the same time, Ether (ETH), fell by 7.7%. As of press time, BTC and ETH currently have a global market price of $42,400 and $2,900, respectively