Cryptocurrencies: Not legal tender
The People’s Bank of China (PBOC) banned financial institutions from handling Bitcoin transactions in 2013, and went further by banning ICOs and domestic cryptocurrency exchanges in 2017. Unsurprisingly, China does not consider cryptocurrencies to be legal tender and the country has a global reputation for harsh cryptocurrency regulations.
Although domestic cryptocurrency exchanges are under a blanket ban in China, workarounds are possible using foreign platforms and websites which China’s internet firewall doesn’t catch. Despite the near-comprehensive prohibition on crypto trading and related services, the law in China currently still permits crypto mining activities – although there are signs that this could change soon.
In January 2018, a leaked PBOC memo suggested that Bitcoin mining operations would soon be banned in China – the memo cited the miners’ consumption of energy resources and their tendency to stoke financial speculation. In February 2018, a joint effort by PBOC and the Ministry of Industry and Information Technology revealed plans to expand crypto exchange regulations to foreign exchanges, banning access both to offshore platforms and to ICO websites. Through the Institute of International Finance, the Chinese government has also expressed support for the implementation of a global regulatory framework for cryptocurrencies.