WeChat Shuts Down Crypto Buying and selling as China Continues with Crypto Ban
On April 30, WeChat made adjustments to its payment terms protocol. From now on, merchants that have accounts on the app are forbidden from conducting any activities that involve digital coins or ICOs. Details were shared by CoinDesk.
No crypto trading on WeChat
The situation seems to be the continuation of the Chinese ban on ICOs and digital currencies which began in 2017.
The new policy on WeChat becomes valid on May 31. All merchants will be banned from conducting any crypto-related payments. Those who do will be forbidden from using any payment services on the platform at all.
A blow against OTC crypto traders
Another action against the crypto industry initiated by WeChat seems to be targeted at OTC crypto traders.
Since WeChat is the most popular messaging app in China, a great number of these traders use WeChat for transferring the local fiat currency to Huobi and OKEx exchanges. These two platforms offer provide venues for OTC trading to swap Chinese yuan for crypto and the other way around.
This is the second phase of the crypto ban placed by WeChat and Ant Financial (an affiliate company of Alibaba) on crypto traders on the messaging app. The initial ban was initiated in late summer last year.
China plans to shut down local Bitcoin mining
Not long ago, U.Today reported that the major state agency in China, the National Development Reform Commission (NDRC), has suggested the total prohibition of crypto mining in the country.
The agency claims that mining takes too much electricity, therefore, it is an industry harmful to the environment.
Since a great part of overall Bitcoin mining pools is located in China, this could present a harsh blow against the crypto market, BTC in particular, bringing down the network’s hash rate.
Still, many observers stay optimistic, believing that other miners will pop up fast, eager to take the new vacant places in this still profitable business.