China’s crypto angst has shown no sign of abating as we enter a new year. Another raft of restrictive regulations has just been implemented for blockchain companies in the People’s Republic.
Data Privacy Not Applicable in China
The Cyberspace Administration of China (CAC) has just introduced more regulations for companies dealing with distributed ledger technology. According to the official announcement the new guidelines will come into effect on February 15.
In the typically draconian way the Chinese government operates, the new regulations demand that startups allow the state to access stored data. It also allows the regime to censor what it deems to be sensitive content under China’s wide sweeping censorship laws. The rules also demand that companies hand over personal details of their users including identification records and phone numbers.
The regulations will apply to websites and mobile apps in China that provide blockchain services or technical support to the public. When implemented companies will be required to register their domain names, and server details to the CAC within 20 days or face heavy penalties.
Fines for a wide range of new offenses relating to blockchain range from 5,000 to 30,000 CNY ($740 to $4,440). The announcement added that for serious offenses criminal law will be applied.
The press release claims that these new regulations will “promote the healthy development of blockchain technology and related services,” however they appear to be achieving the complete opposite. The regulations were originally drafted in October 2018.
Last year China also cracked down heavily on social media channels related to crypto, before turning its heavy hand towards gaming platforms in its ever constant strive to control the internet. It has no regard whatsoever for data privacy and clearly sees that the only viable blockchains within the country should be state controlled ones. In November the People’s Bank of China issued yet another warning about cryptocurrencies which are already banned in the country; “Crypto assets which are not issued by the government do not have legal status equivalent to fiat currencies,” it said.
This latest crackdown is part of China’s ongoing war on crypto that began in late 2017 when it banned exchanges, trading and ICOs. The aggressive stance has forced hundreds of blockchain and tech companies to flee China and relocate in friendlier climes such as Hong Kong and Singapore. China is showing no signs of releasing its ever tightening grip over the internet and flow of information within its borders.
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A Blockchain is a growing list of records, called blocks, which are linked using cryptography. Cryptography is the practice and study of techniques for secure communication in the presence of third party adversaries. Cryptocurrency is a digital currency that uses encryption (cryptography) to regulate the generation of currency and verify the transfer of funds, independently of a central bank.
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