Despite increasing state regulations surrounding the year-long cryptocurrency ban in China, investors are still finding ways to get involved with the market. On August 23rd, the Shanghai Securities Times reported that Chinese authorities are increasing their regulation by preventing investors’ access to 124 non-native exchanges. This news is on top of Beijing’s attempt to ban all cryptocurrency exchanges registered in China to protect their citizens from the volatile market.
However, neither exchanges or Chinese investors are having it. As reported by the South China Morning Post, Chinese trading platforms are moving servers off of the mainland, registering properties in other countries, and changing their domain names to skirt the ban.
Since cryptocurrencies are decentralized assets, it proves near impossible to block access to those interested in acquiring them. Most Chinese investors take advantage of P2P services and VPNs to gain access to crypto, which governments will have a hard time preventing.
Interestingly, some traders are using Tether, a stablecoin currently ranked eighth by market cap, to avoid regulation as well. Tether is backed by the U.S. dollar and used as a transfer of value. Investors convert their fiat currency to Tether to buy different currencies under the radar.
The combination of Tether, VPNs, P2P trading and foreign exchanges make it near impossible for the Chinese government to get involved. While authorities have the power to shut down VPNs, the process is long and arduous.
Suggested Reading : Learn more about Tether in our beginner’s guide.
A Future For Crypto?
Terence Tsang, CEO of TideBit, which makes up a group of exchanges in Taiwan and Hong Kong shared his thoughts on the news:
“The latest warning and potentially increased monitoring of foreign platforms is targeted at a batch of smaller exchanges that had claimed to be foreign entities but are in fact operating in China claiming they have outsourced their operations to a Chinese company. Those exchanges whose website landing pages are in Chinese have drawn particular scrutiny by regulators.”
According to the Shanghai Securities Times, the Chinese government is collaborating with third-party payment groups to block suspect transactions. Chinese conglomerates such as Tencent and Ant Official have stated their desire to prevent crypto trading on their services as well, but it’s unclear how much effort is put towards the banning.
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