PBoC urges investors to increase risk awareness on cryptocurrencies and ICOs

The People’s Bank of China (PBoC) has issued fresh notice cautioning people against the risks associated with cryptocurrency trading and initial coin offerings (ICOs), CCN reported.

In September 2017, the central bank, along with seven government ministries, banned all ICO-related activities in the country. More recently, the PBoC and other regulatory authorities issued a warning against illegal fundraising and trading activities in the name of blockchain.

The central bank’s Shanghai branch has now issued a public notice reminding people to enhance their awareness of risk prevention in this area. It provided some statistics on the virtual currency market post the ban issued last September:

“[T]he global share of domestic virtual currency transactions has dropped from the initial 90% to less than 5%, effectively avoiding the virtual currency bubble caused by skyrocketing global virtual currency prices in the second half of last year in China’s financial market. The impact has been highly recognized by the community.”

Last month, reports floated in the media that Chinese regulators were seeking to block access to 124 cryptocurrency trading platforms with overseas IP addresses. The PBoC today announced that it will continue to monitor the offshore servers of these 124 platforms.

The PBoC said it will “closely monitor ICOs and its multiple variants, strengthen research and judgement, proactively fight and prevent concerns.”

“In addition, it [the internet authority] has also strengthened the disposal of domestic ICO and virtual currency transaction related websites, public numbers, social media etc., and permanently blocked some public numbers suspected of releasing ICO and virtual currency trading hype information.” (as quoted by CCN)

In August 2018, the National Internet Finance Association of China (NIFA), a self-regulatory organization in the field of internet finance, implemented a feature on its platform to help governmental authorities in their clampdown of illegal ICOs. It has added a new category – Token sales – to its platform where the public can report potentially illegal financial activities.

In the past couple of weeks, domestic internet giants such as Baidu, Alibaba and Tencent have also moved to ban cryptocurrency transactions as well as cryptocurrency-related content on their online forums.