Ever since the crypto has come into the world, there is a massive damage to the forex market. The reason being govt used to be the middle-men in between people of two countries when it comes to exchange of currency. With crypto it changes that part massively.
Like making use of the Tether USD or any stablecoin, you can exchange foreign currency from one market to another. And so you bypass the government and the forex broker of govt. Which is a loss for the govt.
Imagine china where govt does everything for you except having kids. You are being watched on every transaction too. They definitely don't like that you are making use of the decentralized cryptocurrency. So you can see they are now cracking down on the forex swap crypto points.
Let's take a look at how China is cracking down on the illegal forex crypto swaps.
Underground Banks with $2.2B Forex Reserve Captured
China has done a lot of inevstigation on how the underground banks have managed to bust some of the forex reserves and have sent the funds across nations. Considering sending high amount of the funds across the foreign is considered as a money laundering unless the person has the permission to do so. In this scheme the underground banks bypassed any such rules.
So the china regulatory has managed to capture the people involved and has fined them and sent them to sentencing. And this means that china continues it's mission to restrict crypto circulation inside the nation. They do have the limit of 50K per year and over which both crypto and foreign reserve would get warning and restrictions.
Chinese Govt Officials using Crypto
It's not just mafia and the ordinary citizens making use of the crypto. But the chinese govt officials are making use of the crypto too. They are swapping the funds among themselves using the crypto. And there is a massive corruption where the govt officials of varying statures are making use of the Tether and other crypto to send the funds among each other.
China has placed the ban for internally trading the cryptocurrency. However there is a massive usage of the crypto underground. Like any other people even the govt officials are using the crypto. So it's really hard to spot how many govt officials are moving the funds from one place to another like this. Imposing laws on the crypto related work becomes lot harder now.
RenrenBit ended in 7 year Sentence
I was not surprised when the China decided to capture the people in the renrenBit company. The company was doing the illegal transfer of the crypto and also they had the desk in such a way that the money transfer was not only illegal locally but on the global scale too. So that has costed them some issues and so triggered the capture.
The company CEO Zhao got caught. And he is now going to serve the sentence for 7 years. This means the illlegal forex swaps througb the crypto is now going to get some halt. Though underground market never ends and it is just going to divert the attention of the people for some time. Let's see how the forex crypto gets new underground market somewhere else.
Chinese Authorities are keeping up with the times and they are now cracking down on variety of the crypto scams both online and offline running through their soil. Let's see how things unfold once their Digital Yuan gets into the action and criminals get caught into the honey trap.