Weekly crypto roundup: China makes crypto transactions illegal

In today’s edition of Bitmama’s weekly crypto news roundup, we cover interesting developments in the cryptocurrency industry. Top picks – China makes crypto transactions illegal, Ukrainian central bank suspends electronic cash transfers, bolsters the use case for crypto, Government is going after crypto miners and assets in South Africa, Crypto market loses $250bn in hours as Russia attacks Ukraine.

Let’s get started.

China makes crypto transactions illegal, threatens up to 10 years in prison

China’s Supreme Court hardened its stance on cryptocurrencies  after enshrining them into law under the list of illegal fundraising methods. The court’s decision was already expected, following late 2021 declarations from the court, the People’s Bank of China and other high-profile government institutions. Under the new interpretation, which goes into effect on March 1st, individuals illegally dabbling in cryptocurrencies could be levied with fines up to RMB 500,000 ($79,000) and face up to ten years in prison.

“This is the first Supreme Court legislative interpretation to officially have cryptocurrency transactions covered under the Criminal Law,” said Winston Ma, adjunct professor of the law school at New York University. 

The new, legally-enshrined view on cryptocurrencies comes after many governments decided to crack down on the technology. A cryptocurrency mining ban was followed by a veritable hunt for illegal activities in the crypto space, prompting most of China’s mining power to jump ship into less dangerous waters. Through the new legislation, suspects will be prosecuted under Article 176 of China’s criminal law, which stipulates prison sentences between three to 10 years and fines between RMB 50,000 (US$7,900) and RMB 500,000 ($79,000) for crimes involving large sums of money. Less serious crimes will be prosecuted with under three years of prison and RMB 20,000 ($3,160) to RMB 200,000 ($31,600) in fines. 

Ukrainian central bank suspends electronic cash transfers, bolstering the use case for crypto

Ukraine’s central bank is cracking down on digital money transfers. This is  one of the latest measures implemented in connection with a nationwide declaration of martial law.

The National Bank of Ukraine ordered electronic money (e-money) issuers to suspend the issuance of e-money and the replenishment of electronic wallets with e-money. The written order also indicated that the distribution of e-money was temporarily off-limits. The reference to electronic money likely refers to fiat currencies held in digital accounts through platforms like Venmo or PayPal.

This is one among many new rules rolled out by the country’s central bank as Russian forces lay siege across Ukraine. The National Bank of Ukraine released a statement Thursday 24th, with a spate of resolutions, including an order to suspend the foreign exchange market, limit cash withdrawals and prohibit the issuance of foreign currency from retail bank accounts.

Government is going after crypto miners and assets in South Africa

The National Treasury plans to further regulate South Africa’s crypto-mining sector and crypto assets in 2022. In its Budget Review published on Wednesday, 23rd February,  the National Treasury said it is exploring measures to regulate electricity‐intensive crypto mining, which is environmentally harmful.

It also, plans to publish a paper to address risks posed by so‐called ‘stablecoins’. Stablecoins are designed to have a value that is much more fixed than normal cryptocurrencies. This is because they are pegged to other assets, such as the US dollar or gold.

The country’s Intergovernmental Fintech Working Group (IFWG) published a position paper on crypto assets in June 2021, setting out a coordinated and phased approach to regulating crypto assets in the country. The Treasury said regulatory authorities are now developing several interventions based on the recommendations in this paper.

 Crypto market loses $250bn in hours as Russia attacks Ukraine

According to data from coinmarketcap.com, the global cryptocurrency market capitalization stood at N1.55 trillion — a 10.4 percent decline over the last day. The value of the cryptocurrency market has fallen by $250 billion in a few hours after Russian forces launched an attack on Ukraine early Thursday morning.

In a televised speech, Russian President Vladimir Putin announced a “special military operation” designed to achieve the “demilitarization and denazification of Ukraine”.

Cryptocurrency prices have continued to plunge since reaching record highs in November 2021.

The recent volatility is driven by intensified tensions between Russia and Ukraine. At 9:04 am on Friday, Bitcoin, the most popular and world’s largest cryptocurrency by market capitalization, declined by more than 7.6 percent in the last 24 hours to $35,274. Ether, the coin linked to the Ethereum blockchain and the second-largest cryptocurrency in terms of market capitalization, also fell by approximately 11.9 percent to $ 2,368.98.

Also read : 3 Best crypto trading strategies you need to know