Cryptocurrencies have had a difficult two months for various reasons, including concerns about the environmental impact of mining currencies and increased government scrutiny.
Cryptocurrencies are getting a lot of attention this week from China, which for weeks has been signaling a more aggressive push to limit the use of cryptocurrencies.
“Cryptocurrency trading and speculative activities … create risks of illegal cross-border transfers of assets and money laundering,” the central bank said.
Lenders include Industrial and Commercial Bank, Agricultural Bank of China, Construction Bank of China, Postal Savings Bank of China, and Industrial Bank.
All six institutions said after the central bank announcement that neither institutions nor individuals can use their platforms for any cryptocurrency-related activities. Alipay has also pledged to intensify investigations against crypto transactions on its platform.
The announcement is not a new policy for Beijing, but it reinforces how far the country is willing to go to restrict the use of bitcoin and other digital currencies.
Although China does not completely ban cryptocurrencies, regulators declared in 2013 that bitcoin is not a real currency and prohibited financial and payment institutions from dealing with it. At the time, they mentioned the danger of using bitcoin for money laundering, as well as the need to “maintain financial stability” and “protect the status of the yuan as an official currency.”
The growing campaign also aims to bolster China’s state-backed digital yuan initiative, which authorities want to implement in order to control money flows.