China is working hard to increase its global influence. Part of this involves reducing its heavy dependence on the dollar as much as possible. At the same time, it is very strict on the crypto industry – until recently, engaging in crypto was almost completely prohibited. On Wednesday, China killed two birds with one stone. Trading in Tether’s stablecoin USDT is now banned.
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China bans all trading in USDT
The Supreme People’s Procuratorate (SPP) is China’s supreme court and therefore the most powerful courtroom in the country. The institute jointly with the State Administration of Foreign Exchange (SAFE) on Wednesday statement published. In it, it notes that all trade between USDT and traditional national currencies in China is now illegal. SAFE is more or less the Chinese version of the American Securities and Exchange Commission (SEC) or the Dutch Financial Markets Authority (AFM).
The two institutions are calling on local courts and SAFE chapters to take stricter measures regarding the use of USDT. Not only should USDT trading in foreign exchange markets be punished, the provision of services that enable it should also be clamped down.
The SPP does not say how many people the government believes have traded in USDT. The Supreme Court did mention that a dozen people were guilty of offering crypto exchanges. For example, Chinese Zhao Moupeng sold the United Arab Emirates dirham for USDT in Dubai, which he then sold in China for the Chinese renminbi. He was sentenced to 7 years in prison and fined RMB 2.3 million.
China remains strict on crypto
The state of crypto in China is very complicated. In 2021, it was officially banned to trade and mine cryptocurrencies. But it is unclear whether digital assets to own was banned at all. In September, several judges ruled that this is legal, although the ban on trading and mining appears to be intact for the time being.
The Chinese government also called on other countries to be stricter on the crypto industry. At the same time, blockchain without cryptocurrencies is already almost commonplace in China, as many large companies are already actively using it.
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2023-12-29 19:54:20
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