China’s government has conducted a massive crackdown on the cryptocurrency industry since last fall and has trumpeted its success in recent months. However, a new report from the South China Morning Post suggests that Chinese cryptocurrency exchanges and traders are finding new and more creative ways to defy the government’s attempts to ban digital currency trading.
The Post’s report cites a story in the government-affiliated Shanghai Securities Times which asserted that the nation’s regulators have been ramping up efforts to monitor and block access to “124 offshore crypto exchanges that provide trading services to Chinese investors.” When the government effectively shut down its domestic exchanges, many of those companies apparently fled offshore, rebranded themselves with new domain names, and continue to look for ways to serve their Chinese customers.
The government is now beginning to focus even more attention on those exchanges, according to TideBit COO Terence Tsang, whose cryptocurrency exchange operates in Taiwan and Hong Kong:
“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.”
Reports suggest that Chinese regulators are currently collaborating with third-party payment firms as part of an effort to identify and halt all transactions associated with digital currencies. The South China Morning Post reported that its parent company, Alibaba, had already agreed to cooperate in that effort – though it noted that such transactions may be difficult to readily identify.