How exactly does China ban ICOs, Bitcoin and crypto currencies

China recently bans all of the activities around ICOs, Bitcoin and crypto currencies. The whole thing happened from 5th September 2017. First it was the ICO, which “disrupts the social order”. Then it is the “illegal trading” of crypto currencies. How exactly did they ban? What did they do?

ICOs

• A few of the executives from the major ICO platforms were contacted by the government in a secret way before 5th September 2017. Rumours of shutting down those platforms spread.
• A notice from a committee led by China’s central bank announced an immediate ban on ICO funding on 5th September 2017.
• Most of the organisations who got funding from ICOs either voluntarily or were ordered to return the funding to the investors. Alt-coins trading platforms were shut down.
• Several articles about the harms caused by the ICOs appeared on the major news platform. ICOs were described the same as pyramid/multi-level marketing activities.

Bitcoin and crypto currencies

• Rumours of banning Bitcoin and crypto currencies spread after the announcement to ban ICO.
• BTCChina announced the closure of its crypto currencies trading platform on 14th September 2017. The other two major platform Huobi and OKCoin did not respond to this news and continued to operate as normal.
• Local governments, such as Beijing, Shanghai and Shenzhen, ordered the trading platforms within their administration to make a plan and shut down by the end of September 2017. It is understood now the cooling period has been extended to the end of October 2017.
• Huobi and OKCoin announced the shut down plan on 16th September 2017 with more details coming in days.
• Rumours to ban crypto currencies mining started spreading. It is not clear yet as I write this article. But some big sales of mining machines were observed.
• The executives of trading platforms were ordered to stay in the city until the closing process finishes.

Other things

• Pretty much all of the announcements were reported by Caixin before the official announcements were made. The media was accused by some crypto traders for spreading fake news, but later on was proved to be a very credible source.
• The chat app Telegram Messenger has seen a spike of Chinese users registered during this period. It is caused by the fear that all of the current social groups(mainly on weChat) regarding crypto currencies trading, even blockchain technology discussion will be monitored and eventually shut down. The organiser of such groups may be held responsible.

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