Huobi To Stop Offering Cryptocurrency Derivatives Trading In China From Today
Colin Wu, a Chinese crypto writer, and columnist, has revealed in a tweet that Huobi will suspend trading in all bitcoin options and other derivative offerings for consumers in mainland China. This is in compliance with regulatory decisions made awhile back.
“As previously announced, Huobi, China’s biggest stock exchange, will today effectively suspend all futures, swaps, and other financial operations for all Chinese users, even those who have registered on the exchange.”- Wu Blockchain (@WuBlockchain) on October 29, 2021 [via Twitter]
Huobi Has Decided To Close Its Derivatives Business In China
In the past, Huobi was the inaugural cryptocurrency exchange to declare that it would be withdrawing from mainland China as a result of the state’s continued prohibition on crypto exchanges in the country. Several other cryptocurrency trading platforms and businesses, including cryptocurrency mining pools, have followed Huobi’s lead. BTC.com and Bitmain are among the companies on this list. The Coinex exchange is pulling out of China, and the Renrenbit platform, which was founded by the “OTC monarch” of China, Zhao Dong, is shutting down its operations as well. Binance has also joined the ranks of Huobi.
Various Personalities Have Speculated On The Grounds For The Crypto Ban
The world’s richest man, tycoon Elon Musk, feels that crypto represents a challenge to the Communist Party’s control in China. As a result, the Chinese authorities have maintained their crypto prohibition. This began in 2017 with the prohibition of initial coin offerings (ICOs). Investment expert Robert Kiyosaki, writer of the best-selling novel “Rich Dad, Poor Dad,” argues that China’s ambitions to introduce its own CBDC—the digital Chinese Yuan (DCEP)—soon have prompted the authorities to eliminate any rivalry to make way for the CBDC.
China Is Attempting To Tax Cryptocurrency Exchanges
Even though the government has declared that all cryptocurrency transactions are illegal, they have admitted that the prohibition still does not have a solid legal foundation. While efforts are being made to incorporate this into the regional judicial process, Bitcoin continues to be recognized as a form of property. Furthermore, China is now attempting to tax cryptocurrency exchanges that provide services to Chinese users, including those that are headquartered outside of the country.
Following the publication of the “ban paper,” many local Bitcoin exchanges, like Huobi initially, chose to relocate, while others chose to close. Major crypto exchanges like Binance have stopped serving the Chinese market since giving Bitcoin trading services in China is now banned. While it is theoretically unlawful to own crypto assets, it is not impossible to do so in practice.
Foreign platforms may continue to operate in China but will be taxed. But first, a legal framework must be laid. Digital commodities (like BTC, Ether, and other Altcoins) will not vanish overnight. Chinese law now allows people to retain virtual currency. These actions, which the law calls “invalid civil acts,” are not expressly outlawed.
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