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The Chinese government is making progress in its mission to eradicate cryptocurrencies from its economy. The move by the government has prompted companies to distance themselves from cryptocurrency-backed transactions in mainland China to avoid any rift with Beijing. One of such companies, KuCoin, whose popularity originated in China, has told its mainland Chinese users to leave its platform.
Tougher Checks to Comply With Chinese Laws
KuCoin announced that its Chinese users have until December 31 to move their funds to other platforms. The crypto exchange explained that it is looking to “protect the interest and safety of its users. KuCoin said all Chinese residents on its platform would need to send their funds elsewhere. The announcement by KuCoin came after the Peoples’ Bank of China (PBOC) sent out a directive asking several other agencies to band together and outlaw crypto transactions of any kind. The PBOC’s statement has already sent out a firestorm, with crypto companies leaving China and even traditional tech companies cutting ties with crypto. Similarly, the e-commerce giant Alibaba confirmed last week that it would stop selling any crypto-related items on its platform. Items ranging from tutorial videos, mining equipment, and more will be blocked from Alibaba’s platform going forward.
No Way Back for Chinese Users This Time
KuCoin explained that it has always looked to comply with regulations from the Chinese government. The company added that it conducted a “technical self-inspection” on September 24 - just days after the PBOC’s announcement came out. The inspection was to ensure that its business complied with China’s regulatory requirements. This is not the first time the Chinese government will be cracking down on crypto companies and operations. The government first hit crypto with sanctions in 2017. China’s new directive has had significant effects on its crypto space. News sources have reported that up to 18 crypto companies have left the country, many of whom will be leaving their customers stranded. While KuCoin is giving Chinese users till December, some other companies haven’t been so lenient. CoinEx, another cryptocurrency exchange, announced last Thursday that it would close all Chinese users by October 31. Besides shuttering accounts of Chinese residents, CoinEx would also close accounts of customers with KYC details linked to mainland China. Chinese accounts on CoinEx with zero assets have already been disabled at press time.