On Monday, Chinese authorities deemed transactions conducted using “virtual assets” as a method of money laundering. China dots its i’s. It is a “no” on the issue of cryptocurrencies.
China attacks bitcoin again
The Supreme People’s Court and the Supreme People’s Procuratorate, the country’s highest judicial bodies, jointly announced changes to the cryptocurrency law. The regulations take effect today, August 20. They are part of a broader effort to tighten anti-money laundering regulations.
The new legal interpretation classifies virtual asset transactions, including those conducted through cryptocurrency exchanges, as activities that “conceal the source and nature of the proceeds of crime.”
In addition, Chinese authorities will now consider money laundering in excess of 5 million yuan ($685,000) or causing losses of more than 2.5 million yuan ($343,000) to be serious crimes. What are the penalties for this? Prison and fines. For up to five years in prison, a sentence of 10,000 yuan ($1,370) can be imposed. For sentences of between five and 10 years, the convicted person will potentially also be fined at least 200,000 yuan ($27,400) (yes, in addition to the prison sentence).
Another mistake by Beijing?
Recently, Tron founder Justin Sun appealed to the Chinese authorities to reconsider their policy on cryptocurrencies. In his opinion, closing themselves off to digital assets is a mistake.
As you can see, Beijing did not listen to the businessman and continues to attack the industry. This is a continuation of the previously chosen direction.
China banned ICOs in 2017. In 2021, it went a step further by introducing a ban on cryptocurrency transactions.
For months, media have speculated that Xi Jinping’s government would reopen to bitcoin, prompted by Hong Kong’s liberalization of its cryptocurrency policy. As it turns out, those hopes were vain.
This is also happening at a time when the US may liberalize its cryptocurrency policy. Everything will depend on who wins the presidential election. Donald Trump’s success could prove to be a positive breakthrough for the industry.
