Industry

China Shuts Down Blockchain News Accounts on WeChat

Prateek Dimri | August 22, 2018 | 11:00 am
china censorship
Industry

China Shuts Down Blockchain News Accounts on WeChat

Prateek Dimri | August 22, 2018 | 11:00 am

In a fresh crackdown on cryptocurrency-related activities, China has blocked several blockchain-related news accounts on WeChat, one of its top social apps.

WeChat Crypto Accounts Shuttered

In 2017, China had imposed a ban on ICOs because of their unregulated nature and the scams associated with them. The recent ban has been imposed due to the accounts’ non-compliance with “national interests” and “public orders”, as the concerned accounts were found to be publishing information on Initial Coin Offerings (ICOs) and cryptocurrency trading.

The ban includes the accounts of some of the biggest cryptocurrency platforms of the country such as Jinse Caijing, Shenlian Caijing, Huobi News according to reports though their sites and apps are still functioning. These company’s leveraged WeChat’s large user base of over a billion members to reach out to their own niche audience segment. Their revenue models included sponsored content about upcoming ICO projects. The information offered on these accounts was crucial for blockchain enthusiasts and cryptocurrency investors who were looking to remain updated on blockchain projects and cryptocurrency price movements.

In May WeChat had suspended a third-party blockchain app which allowed users to create contract agreements and a unique social media ID using blockchain to ensure the authenticity and reliability of their identities and content.

China big on blockchain, but not on cryptocurrencies

Though the government is not supportive of ICOs and cryptocurrencies because of its concerns of financial stability and security, the country has been actively exploring blockchain technology for its implementation across various industries and processes.

In 2017, the country imposed a blanket ban on ICOs and cryptocurrencies, after having issued several warnings to cryptocurrency exchanges. According to reports, the ban has not proven to be very effective and ICOs are still going strong.

Chinese investors are still investing in crypto assets with the help of various cryptocurrency exchanges operating illegally in the country. Some of the exchanges have moved out of the country for now to circumvent regulations, but are continuing to provide their services to overseas and home country investors. ICOs are also continuing to proliferate, defying the imposed regulations. China’s Central Bank, however, feels that the cryptocurrency ban has been successful as recent data suggests that the Chinese Yuan now accounts for less than 1% of all crypto trades.

Blockchain exploration in the country is in full swing, as the government and major companies are looking to implement it across various processes and leverage the efficiency gains offered by it. WeChat has been testing blockchain for inducing efficiency and accuracy in employee expense reimbursement. China Aerospace is reportedly developing a blockchain invoice system to augment its existing electronic invoice system and enable enhanced traceability and accuracy of records.

Zheshang Bank, one of the largest commercial banks of China, reported that it has completed a blockchain-powered issuance of securities worth $66 million, becoming one of the first institutions in the country to utilize blockchain for such an issuance.

 

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