Last Updated on
Bithumb, a popular cryptocurrency exchange, has come out to deny any reports that an inspection notice on its operations by the government of Shanghai has led to its closure in the city. According to a report by industry news medium The Block on November 21, the South Korean exchange assured everyone that its operations had not been interrupted or impeded by any government action.
Citing an announcement on November 14, Chinese financial news site Caixin reported that the Shanghai headquarters of the People’s Bank of China (PBoC), as well as the Shanghai Municipal Financial Regulatory Bureau, had ordered their administrative offices to carry out an inspection of cryptocurrency activities in the city and submit their findings on November 22.
Illegal crypto firms to pack up and leave
China remains one of the murkiest countries as far as legislations on cryptocurrencies is concerned, as while the country has so far allowed mining and blockchain technology to thrive, cryptocurrencies, as well as their trade, sales, an exchange, have been banned for the better part of 2 years now.
Canaan lighted up the Qiantang River (flows throw Hangzhou and Shanghai) the night before its IPO day
The biggest outdoor ads of Bitcoin in China, super dope.
I hope there can be English media covers its founding story, which is super cool and true to the spirit of Bitcoin pic.twitter.com/FT3FKErGxW
— Dovey 以德服人 Wan 🗝 🦖 (@DoveyWan) November 20, 2019
In addition to that, Initial Coin Offerings and cryptocurrency exchanges are restricted from gaining access to the country as well. Per the report from Caixin, the purpose of the report was to ensure that no organization or entity was violating this rule. Any business identified will be required to report its activities to the PBOC and the financial regulatory bureau, and summarily close down its operations.
All is fine on this end
Yesterday, Chinese news source ifeng.com reported that Bithumb had sent off its employees on a “long vacation,” with their date of return to work still unverified. As the report notes, it is possible that the company was flagged by the investigator and is working on solving its operations in the country. The report also revealed that the official Bithumb website showed that all Chinese IP addresses had been banned from accessing the platform.
The directive to inspect Shanghai isn’t surprising. The Chinese government is working on issuing a cryptocurrency of its own, and in doing that, most likely consolidate its control over the crypto space in the country. Any company both found to be compliant with its agenda will be rooted out by force.
However, as The Block reported, any reports of Bithumb being caught in the middle of all this seem to have been exaggerated. A spokesperson for the company reportedly said, “We have one of our blockchain technology research and development teams based in Shanghai and the projects are continuing steadily without pause.”
The spokesperson also claimed that they are focused on their blockchain work in Shanghai, which includes the Bithumb Chain, a blockchain network which is set to go live in the first quarter of next year. The network is set to provide a platform for hosting the family of services on the Bithumb ecosystem, thus helping the company to capture value on its trading business.