China’s Hainan province issues warning on illegal crypto activity – media

FILE PHOTO: Picture illustration of a small toy figurine and representations of the Bitcoin virtual currency displayed in front of an image of China's flag
FILE PHOTO: A small toy figurine is seen on representations of the Bitcoin virtual currency displayed in front of an image of China's flag in this illustration picture, April 9, 2019. REUTERS/Dado Ruvic/Illustration

June 3, 2021

SHANGHAI (Reuters) – Financial regulators in China’s southern Hainan province have cautioned investors against illegal fundraising schemes involving cryptocurrency and blockchain, local media reported on Thursday, as China steps up a cryptocurrency crackdown.

A group of regulators in the island province, including the local financial supervision bureau and a local branch of the People’s Bank of China, said investors should guard against “illegal fund-raising activities under names including ‘virtual currency’ and ‘blockchain’,” the state-backed Nanguo Metropolis Daily reported.

“No organisation or individual in Hainan Province shall illegally engage in token issuance and financing activities; any so-called token financing platform shall not engage in the business of exchange between legal tender and tokens or ‘virtual currencies’, and shall not buy, sell or act as a central counterparty to buy or sell tokens,” the report cited the regulators as saying.

The regulators said financial and payment institutions should not directly or indirectly provide services related to virtual currencies, and virtual currency trading platforms should not provide pricing, trading or other intermediary services.

The regulators’ statement was in line with existing restrictions on cryptocurrencies in China.

Last month, a State Council committee led by Chinese Vice Premier Liu He vowed to crack down on bitcoin mining and trading, a few days after industry bodies banned financial and payment services from virtual currency trading, triggering a market sell-off.

(Editing by Peter Graff)