China's central bank says all cryptocurrency-related activities are illegal, vows harsh crackdown - CNBC

In this article

BTC.CM=

A pedestrian walks past signage for Ethereum, top, and Bitcoin outside the Hong Kong Digital Asset Exchange Ltd. digital currency trading store in Hong Kong, China, on Thursday, June 24, 2021.

Paul Yeung | Bloomberg | Getty Images

China's central bank renewed its tough talk on bitcoin Friday, calling all digital currency activities illegal and vowing to crack down on the market.

In a Q&A posted to its website, the People's Bank of China said services offering trading, order matching, token issuance and derivatives for virtual currencies are strictly prohibited. Overseas crypto exchanges providing services in mainland China are also illegal, the PBOC said.

"Overseas virtual currency exchanges that use the internet to offer services to domestic residents is also considered illegal financial activity," the PBOC said, according to a CNBC translation of the comments. Workers of foreign crypto exchanges will be investigated, it added.

The PBOC said it has also improved its systems to step up monitoring of crypto-related transactions and root out speculative investing.

"Financial institutions and non-bank payment institutions cannot offer services to activities and operations related to virtual currencies," the bank said, reiterating past comments.

The price of bitcoin sank over 3% on a 24-hour basis, last trading at around $42,239, according to Coin Metrics data. Ethereum, the second-largest digital asset, fell 7% to $2,860.

Stocks with heavy exposure to crypto also slumped in premarket trading, with Coinbase down by nearly 4%, MicroStrategy slipping 5% and Riot Blockchain down over 6%.