China's central bank has deemed all financial transactions in digital currencies illegal.
The bank said in a statement today on its website: “Commercial activities related to virtual currencies are illegal financial activities and seriously threaten the security of people’s assets, and violators will be investigated for criminal charges in accordance with the law.”
The bank pointed out that in recent years, “the trading of bitcoin and other virtual currencies has become widespread, which has led to disruption of the economic and financial system and thus to money laundering, illegal fundraising, fraud and other illegal and criminal activities.”
The decision prohibits all related financial activities involving digital currencies, such as trading cryptocurrencies, selling tokens, transactions involving virtual currency derivatives, and illegal fundraising.
After this announcement, the value of Bitcoin fell by 6 percent, after it initially fell 5.5 percent, recording $42.232, to settle at $42.256.