The central bank of China has given further instructions on dealing with cryptocurrencies to regulated institutions, including the Industrial and Commercial Bank, Agricultural Bank, Construction Bank, Postal Savings Bank, and the Alipay payment system. It was reported by the China Financial News Association.
In its address, the Central Bank said that trading in virtual currencies disrupts the normal order in the economic and financial spheres, carries risks of illegal movement of assets across borders, money laundering and other illegal activities, and also seriously threatens the welfare of citizens. In this regard, banks need to strictly adhere to the requirements for preventing the risks of bitcoin and the issuance of tokens, as well as other applicable requirements. In addition, they must carefully comply with their obligations to identify customers and cannot provide services for cryptocurrency-related activities.
“Institutions must conduct comprehensive investigations and identify accounts of virtual asset exchanges and OTC brokers, and promptly eliminate opportunities for such payments,” the publication says. “In addition, they must analyze the distinctive characteristics of cryptocurrency-related capital transactions, improve their means of tracking unusual transactions, and improve their internal mechanisms.”
The source also notes that the organizations to which the Central Bank’s statement is addressed have already expressed their readiness to approach the requirements imposed on them with full responsibility and promised not to carry out transactions related to cryptocurrencies, further strengthen monitoring and decisively stop servicing accounts that contribute to the proliferation of virtual currencies.
As The Block notes, the main outcome of today’s announcement is likely to be the cessation of servicing the accounts of OTC brokers, which, unlike exchanges, have continued to carry out transactions with traditional currencies after the ban imposed in 2017. Since that time, many exchanges have completely switched to trading in cryptocurrency-cryptocurrency pairs, and the task of depositing / withdrawing fiat currency was left to individual brokers who were allowed to advance on their platforms. In fact, the last announcement of the Central Bank became a reminder for banks of the measures introduced several years ago to prevent the maintenance of cryptocurrency services.
The Agricultural Bank of China today confirmed its readiness to follow the instructions of the Central Bank. Unlike 2017 and earlier statements, the bank also promised to close the accounts of clients caught in transactions with cryptocurrencies and report them to the responsible authorities. Also, a similar notice appeared on the Alipay website.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
