China banned all forms of cryptocurrency and related activities in September 2021. However, there seems to be a lapse in enforcing the ban, or the ban is ineffective.
According to an analysis by BanklessTimes.com, China Crawls is reentering the Global crypto adoption index top 10 list.
The CEO of BanklessTimes.com, spoke on the report, “There are concerns about how China is enforcing its crypto ban. The emergence of underground miners and dealers shows a loophole.
“It also shows how the crypto industry is resilient. The 2021 ban is not unique since there were others before that failed. It is crazy how the crypto adoption rate in China is climbing despite the current crypto meltdown.”
The Chinese Cryptocurrency ban
China banned cryptocurrency trading and mining because the industry risks the country’s economy. The ban led to the drop in Bitcoin’s price. Mining operations were also affected.
The action prompted most crypto investors to move to friendly territory. However, many enthusiasts found a way to stay in the market by mining and trading in underground groups.
2021 was a prime year for crypto, with Bitcoin’s (BTC) price again reaching an all-time high in November 2021. Its values exceeded over 65,000 USD in some exchanges.
Similarly, Ethereum (ETH) also surged to new highs in the same month, with prices reaching around 4,800 USD. The surge in value was attributed to DeFi and increasing institutional interest.
Despite the bearish state of cryptos today, most people who invested during the boom (2020 and 2021) are holding tight. They aren’t showing any signs of disposing of their coins. It is fair to conclude that they are betting on a crypto recovery.
China and the law courts
Despite China’s ban on digital asset services, a court has declared that residents can still engage in crypto trading. Notably, trading cryptos is illegal in China due to concerns about stability in the country’s financial system.
According to a recent ruling by Beijing’s No. 1 Intermediate People’s Court, virtual currencies can only be traded by interested investors and should not apply as cash. The ruling affects crypto activities, and most people will exploit it.
The lawsuit involved a Litecoin (LTC) crypto loan with interest promised in another digital currency. According to the details of the case, Zhai Wenjie lent his acquaintance Ding Hao 50,000 Litecoin back in 2015. Ding Hao refuted Zhai Wenjie’s claims that he had agreed to pay monthly interest of 1,000 Litecoins.