Chinese cryptocurrency exchange Huobi to clean up existing mainland clients by end of 2021
App of Huobi Global. /CFP

App of Huobi Global. /CFP

Chinese cryptocurrency exchange Huobi Global stopped taking new customers from the Chinese mainland on Friday and would end contracts with clients in the region by the end of 2021, the exchange said in a statement on Saturday, to comply with local regulations.

The move followed China's latest regulations on banning cryptocurrency transactions and mining in the country on Friday. It is the most detailed and expansive yet from the country's main regulators, underscoring the central government's commitment to regulate the Chinese crypto market.

Friday's regulations clarified that cryptocurrency-related activity and business including exchange, transaction, providing matching services for transactions, token issuance financing and virtual currency derivative transactions are all illegal. Overseas exchanges are also barred from providing services to investors from the Chinese mainland via the internet.

Huobi Global said in the statement it will conduct an orderly exit of its existing mainland clients on the premise that safety of their assets is guaranteed. The specific clearing and refunding rules will be notified to clients through announcements, emails, in-site letters, and short messages.

Screenshot of Huobi Global's statement.

Screenshot of Huobi Global's statement.

In May, China banned financial institutions and payment companies from providing services related to cryptocurrency transactions, vowing to crack down on bitcoin mining and trading.

China has escalated its efforts to restrict its crypto market amid a global cryptocurrency crackdown, concerning the highly volatile digital currencies could undermine the stability of financial and monetary systems, increase systemic risk, promote financial crime and hurt investors.

In addition, the process to gain cryptocurrency –"mining" – is quite energy-hungry, which impedes China to achieve its environmental goals: to reach emission peak by 2030 and achieve carbon neutrality by 2060. China's coal-powered region Inner Mongolia banned all cryptomining projects in April in emission-related concerns.

Friday's regulations sent Bitcoin tumbled. Now its price is bouncing around $43,000, compared with $47,659 a week ago. 

Reports said on Saturday that new users from the Chinese mainland are no longer able to register on Binance, the world's biggest bitcoin exchange and altcoin crypto exchange in terms of volume.

Read more: What makes China a world cryptocurrency mining hub?

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