In support of the Chinese government's tightening clampdowns on local crypto-industry, a mobile payment giant has decided to bar virtual currency transactions on its platform. WeChat Pay on Friday issued a statement stating that they would prohibit users from sending or receiving funds related to…
In support of the Chinese government’s tightening clampdowns on local crypto-industry, a mobile payment giant has decided to bar virtual currency transactions on its platform.
WeChat Pay on Friday issued a statement stating that they would prohibit users from sending or receiving funds related to cryptocurrencies on its social media platform. The Tencent-backed firm cleared that their firm does not tolerate any activity that endorses or financially support the virtual currency-related fundraisers. Furthermore, Tencent has established a risk control model that monitors and reports virtual currency transactions to concerned authorities.
WeChat Pay recently tipped the Chinese regulators about some public accounts that were involved in the promotion and moderation of ongoing Initial Coin Offering projects, Tencent spokeswoman told state media. In response, the China National Fintech Risk Rectification Office had permanently banned these accounts.
“Tencent appeals to its users that they understand the investment risks commonly associated with ICO and virtual currency trading platforms,” the company wrote in its press issue. “We expect to firmly establish a risk prevention awareness, and actively cooperate with the government to maintain financial order and social stability.”
Before WePay, another mobile payment giant AliPay had announced that it would strengthen its supervision on its Over-the-Counter service, fearing it would be used to conduct virtual currency deals, mainly in Bitcoin. The company, like WeChat, is taking steps to block accounts that are found to be breaking the Chinese Bitcoin law.
“We will resolutely refuse services to merchants involved in virtual currency transactions. Based on the circumstances, we would either impose restrictions on account collection functions or even permanently limit collections,” AliPay had told the Chinese media.
China in 2017 had imposed a nationwide ban on the commercial use of virtual currency while highlighting their tough stance against foreign exchanges and ICO projects. However, despite the prohibition, Chinese investors continued to flock towards cryptocurrency sector as a mean to bypass capital control, to simplify money outflows. It somewhat has rattled regulatory bodies that are now resorting to a systematic crackdown, instead.
As a part of their enforcement, the government internet has banned internet access to leading cryptocurrency exchanges, such as Binance, Huobi, and BitFinex, and online crypto media outlets. Moreover, just last week, regulators in China’s Chaoyang District disallowed hotels, shopping malls, and office buildings to host events that promote crypto assets. Binance, which was scheduled to host an event in Beijing on Friday, canceled it at the very last moment.
Since last September, Chinese authorities have shut down a total of 88 cryptocurrency exchanges and 85 ICO projects. The yuan-bitcoin trading pair, which once peaked up to 90 percent of all the Bitcoin trades, has now dropped to less than 5 percent.
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Last modified: May 20, 2020 6:04 PM