An unknown fate of the Chinese holdings of cryptocurrencies.. and a scramble to protect it

Some bearers scramble Cryptocurrencies in China and Hong Kong To find a way to protect bitcoin and other cryptocurrencies after China’s central bank published a new document on Friday outlining tougher measures in the broader crypto crackdown, including enhanced systems to monitor transactions on cryptocurrencies.

“Since the Chinese central bank announcement, in less than two hours, I’ve already received more than a dozen messages – email, phone and encrypted app – from Chinese crypto-asset holders,” said David Lesperance, a Toronto-based lawyer who specializes in transferring wealth to tax havens. who are looking for solutions on how to access and protect their crypto holdings on foreign exchanges and cold wallets.”

Lisperance added that the move was an attempt to freeze crypto assets owned by the wealthy, so that regulators could not do anything legally with them.

“I’ve been anticipating this for a while as part of the Chinese government’s moves to shut down all potential competition for the upcoming digital yuan,” he said.

This comes after the People’s Bank of China revealed on its website on Friday that all transactions related to cryptocurrency in China are illegal, including services provided by overseas exchanges. It also completely banned services that provide deals, clearing and issuance of assets and derivatives for virtual currencies.

Lisperance claims that some of its clients are also concerned about their safety.

In 2013, the state ordered third-party payment providers to stop using Bitcoin. Chinese authorities halted token sales in 2017 and vowed to continue targeting crypto exchanges in 2019. Earlier this year, China’s removal of the crypto-mining industry shut down half of the global Bitcoin network for a few months.

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London-based fintech data analyst Boaz Soprado said: “The CBE notice is not entirely new, and it is not a change in policy.”

But this time, the cryptocurrency announcement covers 10 agencies, including key departments such as the Supreme People’s Court, the Supreme People’s Procuratorate, and the Ministry of Public Security, in a show of greater unity among the country’s top officials. The State Administration of Foreign Exchange has also participated, which could be a sign that the application in this area may increase.

Bespoke Growth Partners CEO Mark Pekin said: “So far, Chinese investors have largely avoided the ban by separating transactions – using local OTC platforms or, increasingly, overseas outlets, to reach an agreement on a trade price, then using Banks or fintech platforms to convert yuan into settlement.”

But as the People’s Bank of China improves its capabilities to monitor crypto transactions, this alternative solution used by Chinese investors will gradually become a narrow tunnel.

“The persistent joke in cryptocurrency is that China has banned crypto hundreds of times,” Soprado said. “I would be willing to bet that people will be trading bitcoin in China a year from now.”

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