Regulatory agencies in China have jointly issued a warning against illegal fundraising and trading activities involving cryptocurrencies.
The warning was issued on Friday by five high-level watchdogs: the People's Bank of China, the Banking Regulatory Commission, the Ministry of Public Security, the Central Cyberspace Affairs Commission, and the State Administration for Market Regulation.
It notably takes aim at cryptocurrency projects that set up operations using overseas IP addresses but solicit investment from Chinese residents and use mobile and internet payments tools to facilitate cryptocurrency trading.
"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," the regulators wrote in the warning, adding:
The regulators also warned the public against new fundraising methods other than initial coin offering – including "initial exchange offerings", "initial fork offerings" and "initial miner offerings" – as ways to speculate on cryptocurrencies.
The issuance follows news from earlier this week that Chinese regulators are moving to block access to more than 100 cryptocurrency exchanges overseas that are still available in China.
Payments applications such as WeChat Pay and Alipay are also in cooperation with government agencies to monitor and suspend user accounts that are suspected of handling cryptocurrency transactions.
PBoC image via CoinDesk
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.