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China’s largest microblogging platform Weibo will no longer host accounts of Binance and Tron. The ban on the two companies signals a fresh round of a crackdown by Beijing on crypto projects.
Homegrown projects banned
Both Binance and Tron are Chinese projects. While Binance has shifted base to Malta, Tron has multiple offices in Asia and the US. The Twitter-like Weibo recently suspended the accounts of both companies without clarifying the reasons. A Binance spokeswoman said on Monday that their Weibo account was suspended last Wednesday. The social media platform didn’t provide reasons behind the suspension.
It is interesting to note that that Shanghai regulator issued a notice demanding the cleanup of crypto-related companies. A Beijing regular also issued a similar notice against unlawful exchanges. Binance suggests that it was banned before the notices were issued. It will appeal the decision. Tron founder Justin Sun believes that the suspension isn’t related to government activities. He said that Tron is trying to restore its account.
China’s fresh crypto clampdown
Chinese President Xi Jinping urged businesses and citizens to leverage the power of blockchain technology and lead innovations. The share prices of all blockchain-connected companies jumped immediately. However, Bloomberg suggests that the Shanghai headquarters of the Chinese central bank isn’t taking cryptocurrency companies lightly. The headquarters ordered local government agencies to plan an exodus of regulated companies from crypto-related platforms and firms on November 14.
The authorities cited orders from the Chinese internet-finance regulator, which stated concerns about the possibility of another asset bubble emerging from the industry. Since the government is pro-blockchain, it may also promote cryptocurrencies that use blockchain technology to revolutionize the world of finance.
However, authorities are not 100% averse to cryptos. The People’s Bank of China (PBoC) is reportedly working on a digital currency of its own. It will most likely be a digital yuan that will be controlled by the government and help it monitor illegal transactions, money laundering, and other unlawful activities more efficiently.
The price of Bitcoin dropped for the fourth consecutive day after concerns about Chinese crackdown became more evident. The coin was trading at $8,429 on Monday afternoon. While it is not illegal to hold Bitcoin to China, the authorities believe that it could be linked to capital flight and speculative activities. Exchanges like OKEx and Huobi are still offering over-the-counter exchange services to users. Even Binance recently started yuan trading OTC recently.