China’s bitcoin crackdown: Beijing targets NGO backed by crypto tycoons and former regulators

While NGOs are heavily regulated in China, the suspension of CBAC coincides with the country’s intensified scrutiny of the cryptocurrency-related sector

In May, Huobi was one of the first Chinese-founded platforms to suspend bitcoin mining services and sales of cryptocurrency mining equipment

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Huobi suspended its bitcoin mining services and sales of cryptocurrency mining equipment in May. Photo: Shutterstock

Published: 7:00pm, 9 Jul 2021Updated: 9:49pm, 9 Jul 2021

China has banned a blockchain industry organisation that had the backing of some of the country’s top crypto tycoons and former regulators, in the latest example of Beijing’s ongoing crackdown on industries related to bitcoin and other digital tokens.

Called out as an “illegal social organisation”, the China Blockchain Application Center (CBAC) was shuttered for operating without registration from the relevant civil affairs authorities, which “disrupted the orderly management of social organisations”, according to a notice posted by Beijing Municipal Civil Affairs Bureau this week.

While non-government organisations (NGOs) are heavily regulated in China and subject to continuous crackdowns, the suspension of CBAC coincides with the country’s intensified scrutiny of the cryptocurrency-related sector, which includes the banning of trading activities and bitcoin mining as well as warnings being issued about financial risks in the sector.

Nonetheless, China has been supportive of blockchain, the underlying technology behind bitcoin, and in late 2019 Chinese President Xi Jinping called for more research and investment into the technology, which sparked a flurry of industry activity.

CBAC, a non-profit organisation established in 2015 with support from the Beijing Financial Work Bureau, said in previous statements that its aim was to “work with regulatory agencies to jointly promote the orderly development of the blockchain industry”.

CBAC did not immediately respond to a request for comment on Friday.