New blow to cryptocurrencies: China declared a war on them

China has banned financial institutions and payment companies from providing services related to cryptocurrency transactions

The Asian giant banned financial institutions and payment companies from providing cryptocurrency services. It ensures that they are not backed up and can affect the safety of people’s property.

China has banned financial institutions and payment companies from providing services related to cryptocurrency transactions and has warned investors against speculative operations with such currencies.

Under the ban, these institutions, including banks and online payment channels, must not offer customers any services related to cryptocurrencies, such as registration, trading, clearing and settlement, said three agencies of the sector in a joint statement Tuesday.

“Recently, cryptocurrency prices soared and plummeted, and speculative trading rebounded, seriously infringing on people’s property security and disrupting the normal economic and financial order,” the agencies noted.

China banned cryptocurrency exchanges and initial coin offerings but did not restrict holding by individuals.

Institutions should not provide cryptocurrency savings or trust services , or issue related financial products, the statement added.

The statement also highlighted the risks of cryptocurrency trading, saying that virtual currencies are “not backed by real value, their prices are easily manipulated, and trading contracts are not protected by Chinese law.

The three industry bodies are the China National Internet Finance Association, the China Banking Association, and the China Payment and Clearing Association.