A major Bitcoin scandal has recently erupted in China, as reported by a Chinese state newspaper. This scandal involves a company in China linked with Bitcoin activities despite the fact that Bitcoin and other cryptocurrency transactions have been banned in mainland China since 2021.
China banned all cryptocurrency transactions and related services starting in 2021, including offshore exchanges providing services to Chinese citizens. The ban included warnings that employees and companies involved in crypto activities would face investigation and prosecution.
Despite this, China’s local governments have held and sold large amounts of Bitcoin seized from illegal activities, totaling tens of thousands of Bitcoins valued at billions of dollars. These seized cryptocurrencies have become a significant, though opaque, source of revenue for some regions.
There have been calls within China for clearer regulations on handling seized cryptocurrencies due to concerns about inconsistent procedures and potential corruption.
The government has intensified crackdowns on crypto, with multiple state-backed organizations warning investors about the risks and the lack of protection for losses from crypto buying selling, which is seen as disrupting economic and financial order.
Corruption cases involving cryptocurrencies have also emerged, such as a former central bank official accused of bribery related to virtual currencies.
The newly reported Bitcoin scandal is consistent with this regulatory environment where Bitcoin activities are banned but continue in shadow or illicit forms, creating risks and legal complications. Unfortunately, detailed specifics about the scandal including the company involved and the precise nature of the wrongdoing have not been disclosed in the available sources.
Therefore, the core facts are that despite the ban, Bitcoin-related scandals and illegal activities persist in China, attracting government scrutiny and media coverage in state-run outlets. This latest scandal adds to the ongoing complexity and tension around cryptocurrency in the country.
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