China, known for its strict bans on Bitcoin and cryptocurrencies, is planning to restrict cryptocurrency businesses within the country and in Hong Kong.
Proposed Crypto Business Bans
According to a report from the Chinese news agency Caixin, the Chinese government is considering prohibiting major internet companies and state-owned banks from operating in the cryptocurrency sector in Hong Kong. These measures will affect both stablecoins and other cryptocurrency operations.
Focus on Real Economy
The bans will aim to compel these entities to prioritize the development of the real economy over virtual assets. Thus, Beijing is instructing these organizations to focus on traditional economic projects.
Reactions and Consequences
It has been reported that major Chinese internet companies may withdraw from cryptocurrency-related businesses in Hong Kong, and branches of central banks may be excluded from ongoing applications for stablecoin licenses. This comes amid the recent implementation of stablecoin regulations in Hong Kong.
The introduction of new bans on cryptocurrency business in China indicates the authorities' caution towards virtual assets and their desire to focus on real economic initiatives.
