Latest in Gear

Image credit:

China might shut down the country's bitcoin exchanges

It could deliver a massive blow to the virtual currency.
Share
Tweet
Share

Sponsored Links

Chris Ratcliffe/Bloomberg via Getty Images

China has never been a fan of digital currencies like bitcoin, and now the country appears bent on a major crackdown. In the wake of China's recent ban on initial coin offerings (where you raise funds for a new cryptocurrency), Wall Street Journal sources understand that Chinese officials are ordering the shutdown of domestic bitcoin exchanges. The timeline isn't clear -- one says the closure decision had already been made, while another heard the process would take "several months." If the scoop is accurate, however, the motivations are clear.

According to one of the tipsters, China is worried that virtual currencies are creating "too much disorder." That's not entirely without merit: people were buying up bitcoin and selling the yuan in 2016 on the belief that the conventional currency's value was going to tumble. And it's no surprise that China would be nervous about money that it can't fully control. It's relatively easy to skip the bank system and trade money beyond China's borders, and that's nightmare-inducing for an authoritarian government.

If China does shut down the exchanges, it could be a severe blow to bitcoin at large, and would certainly cause anxiety for people holding other formats like Ethereum. As The Verge explains, three Chinese exchanges represented 45 percent of bitcoin's market share in the past month. It wouldn't be the end of bitcoin trading, even in China (informal trades can still take place), but it would cause chaos at time when confidence in the technology is otherwise at an all-time high.

All products recommended by Engadget are selected by our editorial team, independent of our parent company. Some of our stories include affiliate links. If you buy something through one of these links, we may earn an affiliate commission.
Comment
Comments
Share
Tweet
Share

Popular on Engadget

BMW will discontinue its iconic i8 hybrid sports car in April

BMW will discontinue its iconic i8 hybrid sports car in April

View
Apex's electric supercar includes an AR race coach and partial self-driving

Apex's electric supercar includes an AR race coach and partial self-driving

View
Tesla starts delivering the Model Y

Tesla starts delivering the Model Y

View
'Modern Warfare 2' remaster reportedly goes on sale tomorrow

'Modern Warfare 2' remaster reportedly goes on sale tomorrow

View
The Morning After: FDA clears five-minute lab-in-a-box COVID-19 test

The Morning After: FDA clears five-minute lab-in-a-box COVID-19 test

View

From around the web

Page 1Page 1ear iconeye iconFill 23text filevr