Jakarta, CNBC Indonesia – Bitcoin price has decreased sharply. Mother of cryto, Bitcoin at least fell by more than 8.5% at one level after the Chinese government confirmed it would crack down on cryptocurrency miners and trading.
This will be done through regulations that will be set by the government. Chinese Deputy Prime Minister Liu He and the State Council said this themselves, that stricter regulations are needed to protect the financial system.
“It is necessary to crack down on Bitcoin mining and trading behavior, and strictly prevent the transmission of individual risk to the social sphere,” the statement read. CNBC International, Sunday (23/5/2021).
China’s concern about mining activities and crypto transactions because these activities are considered to be the center of a number of problems. Bitcoin mining is carried out by computers with a large use of energy, which is likely to pollute the environment.
“It is also important to maintain the smooth running of the stock, debt and foreign exchange markets, crack down on illegal securities activities, and severely punish illegal financial activities,” the statement continued.
To note, this official statement from China follows the steps of a government agency that has banned financial institutions and payment companies from providing services related to cryptocurrency transactions. The country has even warned investors against trading cryptocurrencies that the government considers speculative.
The official announcement was made jointly by the three bodies namely the China National Internet Finance Association, the China Banking Association, and the China Clearing and Payments Association. Under the rule, financial institutions include banks and payment channels online, may not offer clients anything related cryptocurrency.
Chinese authorities say the use of crypto money seriously violates the security of people’s property. It even disrupts the normal economic and financial order.
“Institutions may not provide savings, trust or guarantee services cryptocurrency, or issue financial products related to cryptocurrency, “said the statement.
This is not only the first concern of world governments towards this activity. Several financial authorities in the world are concerned because these crypto transactions are used for illegal activities.
The United States (US) government promised Thursday to be tough on those who use Bitcoin to carry out widespread illegal activities. Including tax evasion.
The US Treasury Department said it would request reports on crypto transfers with a nominal value of more than US $ 10 thousand. This is the same thing as a cash transaction.
The US central bank The Federal Reserve also said it would soon release a paper outlining its own research into the area of central bank digital currencies.
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