Chinese watchdog of financials informs the Government that the country’s biggest crypto trading platforms, such as OKEx and Huobi, are not fully complying with the recent guidelines. Tells that compliance has been partly fulfilled while the major portion of their activities is running against the guidelines. Urges Government’s involvement in the matter on an urgent basis.
The global crypto community had gone through a report, which was stemmed from the Chinese Central Financial & Economic Affairs Commission (CFEAC). The report was duly represented in the CFEAC’s 51st Meeting, which was convened on 21 May 2021. In this report, the Chinese Government had once again reiterated its stance towards crypto mining, especially Bitcoin mining. The report also took notice of the suspension of crypto services by exchanges like Huobi, which were otherwise obtained by Chinese customers.
China has recently banned Bitcoin mining as well as the mining of another crypto as well in the country. Because of this initiative, Bitcoin has heavily affected adversely and its value succumbed a great deal and lost half of the value. However, Bitcoin is still undergoing the process of recovering and has only been able to reach near US$ 40,000. Before the trash caused a loss to Bitcoin, its value was about US$ 60,000.
However, the global crypto community did not take the recent action of the Chinese Government banning Bitcoin mining politely. It was reported in the local media news that as revenge leading crypto trading exchanges have been suspending mining operations. For instance, firms like OKEx and Huobi, have not been allowing Chinese miners the services of cloud hosting and rejecting sales of the Chinese miners.
It has been debated in the local Chinese crypto community that Houbi Pool has decided to permanently suspend the provision of services to Chinese customers. Any mining machines built for Bitcoin mining shall be removed automatically from the shelves, said Huobi. In addition, however, those machines, which are FIL-based, shall not be affected, explained further Huobi.
It is assumed within China that the Government is trying to take down the local Bitcoin mining industry. This is why the native crypto coin of OKEx namely OKB has not been utilized any further by OKEx.
However, both these firms are not apparently complying in toto with the instructions of the Government. They are only complying partly, and there is the likelihood that the Chinese Government would come at them harshly. However, both these firms have been in wait because they are expecting policy change or further clarification by the Government in this regard.
Under the guidelines, obviously suspending custodial services of mining machines as well as their sales will not ensure compliance on part of Huobi. Similarly, delisting RMB from the platform will also not help OKEx in avoiding compliance.