According to the publication of Yicai, the Department overseeing the country’s public communication networks has begun to monitor offshore cryptocurrency exchanges, in addition to internal websites that traders and investors use to facilitate peer-to-peer (P2P) transactions.
The Department paid special attention to cryptocurrency exchanges, which were previously located in mainland China, but moved their activities in response to the ban on cryptocurrency trading which was put into effect by The people’s Bank of China (PBoC). The government applies this policy to prevent pyramid schemes, money laundering and other fraudulent activities related to the cryptocurrency industry.
Despite monitoring the activities of cryptocurrency exchanges, small-scale cryptocurrency traders began to trade cryptocurrencies through over-the-counter (OTC) trading and P2P transactions. Many of them have also successfully opened accounts on offshore exchanges, which provide conventional order-book trading.
According to the CCN, the government’s restrictions have led to the fact that the volume of trade in cryptocurrencies, expressed in Chinese yuan (RMB), decreased from 90% to the current volume, according to estimates of only 1%.
Many cryptocurrency skeptics expected that such a sharp drop in cryptocurrency trading in China would mean death for bitcoin and its competitors, but these forecasts turned out to be wrong. The Chinese authorities’ ban on cryptocurrency trading has not had a long-term impact on global cryptocurrency markets.