Alipay, the payment service by Chinese eCommerce giant Alibaba has banned all transactions in cryptocurrencies. The company’s relationship with digital coins was recently being talked about in crypto circles.
What happened to the crypto plan?
According to Binance CEO Changpeng Zhao, Alipay could be used for on-ramp transactions for converting fiat to crypto. Note that Alipay and WeChat Pay are two payment methods being used for buying digital currencies on Binance, the largest cryptocurrency exchange in the world. Earlier on Twitter, a user asked CZ, “Is #Binance now accepting fiat on-ramp with #Alipay and #Wechat pay? Exciting news… would love for someone to confirm. @cz_binance” and he replied in affirmative.
Alipay wasn’t too happy with CZ’s claims and wrote on Twitter,
“There’re several reports about @Alipay being used for bitcoin transactions. To reiterate, Alipay closely monitors over-the-counter transactions to identify irregular behavior and ensure compliance with relevant regulations.”
It even said that the company is monitoring all transactions closely and will quickly identify and ban any transactions related to Bitcoin or other digital currencies.
China’s crypto journey
A few years ago, China was the hub of crypto trading as well as crypto mining, but the authorities weren’t too keen on letting the industry develop unchecked. They cracked down on the industry, driving out several miners and crypto trading platforms like Binance, which is now located in Malta. In April this year, the Chinese were mulling the possibility of banning crypto mining. However, for now, they are busy uprooting mining operations in the Inner Mongolia region.
Despite these efforts, the Chinese central bank is reportedly working on a state-backed digital currency which will be issued to seven of the premier institutions in the country including tech giants like Tencent and Alibaba. These first-receivers will then be tasked to ensure that the cryptocurrency circulates in the country and reaches the common people.
Overall, the Chinese government is positive about the potential and use cases of blockchain but wouldn’t touch cryptocurrency with a 10-feet pole. With a state-backed digital currency, the authorities may try to make their presence felt in the crypto world without depending on open blockchains like Bitcoin. Moreover, it could be useful in reiterating the dominance of RMB in the world. Note that the government hasn’t made it illegal for citizens to hold Bitcoin yet.
The date and time of the launch of the state-backed digital currency have not been announced yet.