China sends out another crypto crackdown warning as it orders a Beijing software maker to shut down

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China sends out another crypto crackdown warning as it orders a Beijing software maker to shut down
China is increasingly cracking down on bitcoin. Florence Lo/Illustration/Reuters
  • Chinese authorities ordered a software maker to close over suspected involvement in crypto trading, reports said.
  • Companies can't provide advertising services for crypto-related businesses, Chinese regulators said.
  • The move by China's central bank and Beijing's financial regulator steps up the crackdown on crypto.
Chinese authorities have told a Beijing-based software maker to shut down over its suspected involvement with cryptocurrency trading, media reports said Tuesday, a sign the country's authorities are pressing on with their crackdown on digital assets.

Beijing Qudao Cultural Development closed its doors on the orders of a Beijing office of China's central bank, which said the company had facilitated crypto transactions via the software services it offered, Channel News Asia reported. The software company's website is no longer accessible as part of the enforcement.

The People's Bank of China said in a statement that it took the action "to prevent and control the risk of speculation in virtual currency transactions, and protect the safety of the public's assets," the report said.

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The central bank office also warned that companies in Beijing are not permitted to encourage crypto trading in any way. In particular, it noted they are banned from providing physical trading venues and crypto-related services, and from promoting cryptocurrencies through commercial displays or advertisements.

Financial and payments firms were further told not to offer direct or indirect cryptocurrency-associated services to their clients.

China has been cracking down on crypto over the last months. Financial institutions in the country are not allowed to offer crypto services, and associated businesses, such as bitcoin miners, have been placed under tight restrictions or forced to halt operations in some regions. Some crypto influencers had their social media accounts blocked.

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The crackdown has had an impact on cryptocurrency prices as well as on global crypto-trading activity. Ether's global hash rate for example fell by 23% in June as China's regulatory grip tightened, while blockchain analysis firm Glassnode found that the ban on crypto mining was putting pressure on firms to liquidate crypto assets, dragging prices lower. Last month, China said it has arrested over 1,100 suspects on crypto-related money laundering charges.

The Chinese government has addressed the crackdown, saying that it is necessary to reach the country's climate change targets as crypto mining and transactions use a significant amount of energy. Concerns over security and fraud have also been cited.

For a more in-depth discussion, come on over to Business Insider Cryptosphere — a forum where users can deep dive into all things crypto, engage in interesting discussions and stay ahead of the curve.

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