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BEIJING (AP) — China’s central bank launched a campaign to curb the use of unofficial digital currency by declaring all transactions involving Bitcoin and other virtual currencies illegal on Friday.
Chinese banks were banned from transacting with cryptocurrencies in 2013, but the government issued a reminder this year. This reflects official concern that cryptocurrency mining and trading may still be ongoing, or the state-run financial system may be indirectly exposed to risks.
Friday’s notice complained that Bitcoin, Ethereum and other digital currencies corrupt the financial system and are used in money laundering and other crimes.
“All virtual currency derivatives transactions are illegal financial activities and are strictly prohibited,” the People’s Bank of China website said.
Supporters of cryptocurrencies say they allow for anonymity and flexibility, but Chinese regulators worry they could weaken the ruling Communist Party’s control over the financial system and say they could help hide criminal activity.
The People’s Bank of China is developing an electronic version of the country’s yuan for cashless transactions. Beijing.
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