China has not been very friendly towards crypto and businesses involved in crypto. This has included action from governments like banning of ICOs, to internet companies actively trying to push out crypto users from their platform. Just a few days back, WeChat, a messaging app controlled by Tencent, has updated their payment service protocol expanding their crackdown on crypto.
The recent update on payment service protocol came on April 30th, the protocol is a set of rules which governs the use of platforms similar to Paypal’s terms and conditions. The new changes demand that the merchants using the service of WeChat should not be involved directly or indirectly in any initial coin offerings as well as operating virtual currency trading. There are some catches though, only merchants are banned from associating with crypto, this kind of leaves the situation of individual customers in some ambiguity. This doesn’t imply that WeChat is fine with individual users doing crypto trade in its platform, but at the same time, the wording in the protocol does not specifically imply that crypto transactions are illegal. This is really going to hit the crypto community in China as many, especially OTC (Over the Counter) traders, used WeChat services to settle payments in Yuan. This is the continuation of WeChat’s long-time stance of banning users from using its platform to engage in crypto-related transactions.
Even though there is no official statement about government pressure, it is safe to assume that the Chinese government was somewhat involved in the process. The Chinese government has been using internet companies to censor and control online activities, and the government isn’t shy about it either. Recently the government issued a guideline which even called for the shutting down of mining activities in the country. This could be an extension of that. While other countries are opening up to crypto and making its industry legal with newer regulation it is odd that China wants to miss out on the next big technological revolution.
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