Crypto Exchanges changing Domain Name to circumvent China Ban
Chinese traders have remained persistent while their government has enforced a strict crackdown on the country’s cryptocurrency industry. The investors have not let up and are continually evading the authorities, as per reports from the South China Morning Post (SCMP).
Trading officials from the government are constantly updating their control systems, monitoring any illicit activity and have blocked access to 123 crypto exchanges on foreign soil that provide relevant services to Chinese investors, as covered by the Shanghai Securities Times. Virtual Private Networks (VPNs) and Tether (USDT) are used to skirt the aforementioned regulations. The former is used to mimic a public network so that the foreign exchanges can be accessed, while the latter is used to leverage the digital currencies so that it can be exchanged for fiat currency or vice versa.
The anti-crypto policies started to resonate from early 2017 and by September of the same year, the government had officially banned Initial Coin Offerings (ICOs) and Bitcoin Exchanges. The exchanges, however, did not back down, they continued operations despite the ban, by masking themselves under different domain names under foreign identities, thereby trading with locals.
Due to the very principles that make cryptocurrencies so lucrative and attractive a nation-wide ban like the one China imposed will have little effect. The industry experts claim that these trading platforms cannot be adequately blocked, as long as they remain on foreign soil, transactions are completed from one end to the other with no intermediary, a completely decentralized approach.
Regulations like these will initially make the rookie crypto investors fall out due to decline in trading interest and later on the access to the investment platforms will be reduced.
A source close to the foreign exchange said that the Chinese officials have the “technical ability to shut down VPNs”, but at present VPNs are unrestricted and are used as a loophole to access foreign crypto-exchanges by the Chinese traders.
Other state-run organizations also embody a very anti-crypto rhetoric, the state-run media outlet People’s Daily (Renmin Ribao) went after several crypto-centric media outlets, with the accusation that they were manipulating the cryptocurrency markets. WeChat, the popular Chinese messaging platform, blocked these crypto media accounts on the account that they were violating guidelines.
Image via Shutterstock
Join our Telegram group