Bank of China, a Chinese central bank, is continuing with its anti-crypto campaign, this time the bank has issued a long post in its official WeChat account lashing on crypto exchanges. According to Cointelegraph, the post which was released on March 22 is titled “3.15 Protetion of Financial Consumption Rights and Interests”.
Through the post, the bank warns the crypto worshippers against crypto investment highlighting three major issues or concerns being witnessed on crypto exchanges.
According to the post, the top three Chinese crypto exchanges have registered a significantly higher turnover rate compared to foreign exchanges licenced to operate in China which raises eyebrows about bots committing fraud transactions.
The post also points out that crypto exchanges cause deliberate breakdowns or downtimes to force leveraged trading positions loss. As per the post, a large crypto exchange platform reported six system downtime in one year, where three were reportedly unexpected and occured due to unknown reasons.
The post also states that after a thorough analysis of withdrawal data from the crypto trading firms, the central bank found some evidence of suspected money laundering activities.
The post stated:
“First of all, the amount of fraud transactions with bots is serious. The average turnover rate of the top three overseas crypto currency exchanges is much higher than that of foreign licensed exchanges. Second, market manipulation exists in these exchanges where forced leveraged trading eventually causes the exchanges to explode. Third, money laundering is a big issue.”
The post also cautioned the public that the saying that Bitcoin is a safe haven when it comes to investments, stating that this is false as the king coin is highly volatile and can lead to huge losses. The central bank urged the public to avoid following the crowd and keep away from any crypto investments.
The post comes at a time when the financial markets are experiencing tough times and people have been exploring the crypto space as an alternative to the traditional money markets. This post aims at stemming the increasing interest on cryptocurrencies in China despite massive crackdown on crypto-based businesses by government authorities.