False News Targeting Chinese Bitcoin Exchanges Using Photos From Scam Crackdowns
Controversy surrounding the decision of People’s Bank of China (PBoC), the nation’s central bank, on the crackdown on initial coin offerings (ICOs) and the declaration of ICOs as an illegal fundraising method has led to the emergence of a series of false news targeting major Chinese bitcoin exchanges and trading platforms.
Intentional Release of False News Targeting Large-Scale Bitcoin Exchanges
Earlier this week, local bitcoin and cryptocurrency news source CnLedger revealed that various media outlets have reported falsely on the arrest of BTER administrators and operators, using photos from a previous crackdown on an unrelated scam in 2016. By altering the logo of the 2016 ponzi scheme to BTER’s, several media outlets falsely reported that BTER was subjected to a full investigation by the PBoC and employees of the trading platform was arrested.
Lot’s of false news. Don’t believe them unless they’re confirmed or verified. Up to now, no exchange is forced to close, no body is arrested pic.twitter.com/puCQVBJH5u
— cnLedger (@cnLedger) September 6, 2017
Evidently, that has not been the case. Most of the leading bitcoin trading platforms within China including Huobi, OKCoin and BTCC have collaborated closely with PBoC and other financial regulators within the Chinese government in order to establish a more transparent and fair standard for both investors and businesses in the bitcoin sector.
On September 8, more rumours circulated within the bitcoin community that Huobi, OKCoin and BTCC, the three largest bitcoin exchanges in the country, were requested to comply with new policies and directives imposed by PBoC and other Chinese financial regulators. Media outlets falsely reported that the supposed “new policies’ were to alter existing regulations established for bitcoin and cryptocurrency businesses, including exchanges and trading platforms.
Almost immediately after such reports were released, BTCC, Huobi and OKCoin all clarified through various social media channels and online bitcoin communities that they have not received any directives from Chinese regulators and that they are operating normally, as they have been since January of 2017.
“BTCChina Exchange is operating normally, and has not received any new directives from Chinese regulators,” said the BTCC operating team.
Why are Bitcoin and Cryptocurrency Exchanges Being Targeted?
Currently, the Chinese bitcoin and Ethereum industries are struggling to deal with the Chinese government’s abrupt crackdown on ICOs and blockchain projects. Startups that have raised millions of dollars through successful ICO campaigns have been requested to process refunds for investors.
“Financing through coin offerings refer to financing bodies raising virtual currencies such as Bitcoin or Ethereum from investors through illegal sales and circulation of crypto currency or tokens. Such offerings, in essence, are unauthorized and illegal public fundraising and are suspected of involving in criminal activities such as illegal selling of tokens, illegal issuance of securities, illegal fundraising, financial fraud and pyramid schemes,” PBoC’s statement read.
But, unexpected issues have emerged over the past week. Some investors have been refusing to take refunds, demanding the tokens of ICO projects that they have sent their payments for. More to that, many blockchain projects are finding it difficult to process refunds for every single investor that participated in their ICOs.
Taking advantage of the chaotic bitcoin and Ethereum markets, several incompetent media outlets and online communities have been intentionally targeting Chinese businesses, as any controversial news in regard to the Chinese cryptocurrency industry has become a new global trend.
Image License: Pixabay
Joseph Young is a finance and tech journalist based in Hong Kong. He has worked with leading media and news agencies in the technology and finance industries, offering exclusive content, interviews, insights and analysis of cryptocurrencies, innovative and futuristic technologies.
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