Crypto exchange blocks trading in China after PBoC announcement

Huobi Global, one of the world’s largest cryptocurrency exchanges, announced that it would close all user accounts in mainland China by the end of the year. This announcement came over the weekend after China declared that all cryptocurrency transactions were illegal on Friday.

Founded in 2013, Hubobi Global said that it had blocked new customers from China from registering for new accounts. The exchange said that it would close all existing accounts in China by the end of 2021 to ensure the safety of its customers’ assets.

“To comply with local laws and regulations, Huobi Global has ceased account registration for new users in Mainland China, effective September 24, 2021 (UTC+8).

“Huobi Global will gradually retire existing Mainland China user accounts by 24:00 (UTC+8) on Dec 31, 2021, and ensure the safety of users' assets. We will inform users of the specific arrangements and details through official announcements, e-mails, text messages, etc,” it wrote in the statement.

Following this announcement, the exchange’s native cryptocurrency, the huobi token, fell to eight-month lows, below $6 on major exchanges early Sunday, hitting its lowest point since January 30.

At press time, the cryptocurrency was changing hands near $7.67, according to data provided by CoinMarketCap.

Huobi token has lost 80% of its value since China renewed its crackdown on cryptocurrency trading and mining in mid-May. Coindesk reported that the token’s price has more than halved in the past seven days.

In a statement issued on Friday, the Chinese central bank reiterated its harsh stance against cryptocurrency trading activities, saying that virtual tokens such as bitcoin and ether are not legal tender. Cryptocurrencies “should not, and are not capable of being circulated in the market and used as currencies,” it said.

Naming bitcoin, ether, and tether as examples, the central bank said cryptocurrencies are issued by nonmonetary authorities, use encryption technologies and exist in digital form, and shouldn’t be circulated and used in the market as currencies.

On Friday, the price of bitcoin tumbled after the news hit the wires. On Monday, bitcoin was trading at $43,490, according to CoinDesk, making gains on the losses.

Shares of Hong Kong-listed Huobi Technology Holdings Ltd., a unit of Huobi Global that manufactures electronic products and operates a virtual-asset service platform, fell 21.5% on Monday.

Picture Credits: PYMNTS.com

With inputs from Wall Street Journal