The Shenzhen branch of the People’s Bank of China (PBOC) has begun auditing the activities of firms suspected of conducting illicit operations with digital assets. The regulator “took swift action to restore order and make adjustments” to the operations of 11 companies, according to the Shanghai Securities Journal, citing the PBOC.
“At present, the PBOC has completed a business adjustment of a well-known financial website suspected of facilitating illegal deposit operations with currency. The regulator has also duly handled eight reports of illegal and criminal activity related to online forex trading and cross-border stock trading,” the statement said.
Chinese regulators often use the wording ‘made adjustments’ to denote intervention aimed at ensuring a company’s operations comply with current law.
Similar terminology, for example, was used during the pursuit of fintech firm Ant Group (a subsidiary of Alibaba Group) in 2020. To continue operating, it had to restructure its business into a financial holding company. The authorities’ actions scuttled an IPO, through which Ant planned to raise about $34 billion.
Earlier, the PBOC said it would continue to exert pressure on the crypto-trading sphere. The Chinese central bank aims to tighten regulation of internet-finance platforms and curb illegal operations involving digital assets.
In May, Chinese Vice Premier Liu He, at a meeting of the Financial Stability and Development Committee, announced measures regarding Bitcoin mining and trading.
In June, the PBOC held a meeting with representatives of financial institutions and barred them to participate in cryptocurrency transactions.
In July, Deputy Governor Fan Yifei described Bitcoin and stablecoins as speculative instruments, posing a threat to financial system security and social stability.
As reported in August, authorities in China said they would continue regulatory pressure on technology companies.