Cryptocurrency Exchanges Blocked By China After Binance Exchange’s Hack

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Cryptocurrency Exchanges Blocked By China After Binance Exchange’s Hack

Several cryptocurrency exchanges have been blocked in China, a day after major cryptocurrency exchange Binance suffered a major hack. This caused investors to suspect that the Chinese government may be involved.

In China several cryptocurrency trading online portals including Binance, BitMEX, Bitfinex have all gone offline on Friday afternoon. Major cryptocurrencies prices including Bitcoin and Ethereum have continued to drop. During the past 24 hours they lost 12% and 11% respectively.

Last September, the Internet finance regulators in Beijing reportedly shut down all cryptocurrency exchanges after the People’s Bank of China and six other state regulators jointly announced a complete ban on initial coin offerings (ICOs) in China. At that time, China’s three largest Bitcoin exchanges said they would cease trading activities in China without specifying the reasons behind such move.

The ICO ban was provided by an official document issued by seven state regulators. But the cryptocurrency exchanges ban has been without any official statements of enforcement.

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Trading websites, after September ban, continued to operate, but provided over-the-counter services in China instead of centralized trading services. Huobi.com, for example is still accessible from China. It provides information about coin sellers including prices, the numbers of coins and preferred payment methods.

There were also created online forums and WeChat groups to promote OTC trading. The other trading websites transported their servers overseas. Binance moved to Japan from China. After yesterday’s Binance hack, the most of cryptocurrency exchanges available in the country have gone dark.

A Beijing-based lawyer said:

“Binance’s hack shows clearly that there is cyber security concern and shutting down the websites may be a precaution measure for the regulator, especially during China’s Two Sessions. But there is no evidence to prove that the government did so”.

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