China: Cryptocurrency Traders Use Tether and VPNs to Beat Prohibition

According to some media, Chinese investors have found several parades to circumvent the ban on cryptocurrency trading in place in the country.

Tether and VPNs to the rescue of Chinese traders

Despite the restrictions put in place by the government, several observers believe that many Chinese still manage to speculate on cryptocurrencies.

Citing sources close to the record, the South China Morning Post reports that these individuals rely on the "stablecoin" Tether to use crypto-trading platforms. They connect to it through virtual private networks (VPNs), which allows them to protect their anonymity.

The media adds that the government has not yet taken steps to try to block the use of these networks:

"Chinese regulators have sufficient technical possibilities to prevent the use of VPNs [...] However, this process usually requires negotiations with multiple stakeholders to agree on the configuration of a firewall, which makes the longer process ".

While the authorities have been hostile to crypto-currencies for several years, they decided last year to ban local exchange platforms. Some of them manage to get around this prohibition, by moving their servers out of the country, and by registering abroad.

China attacks foreign platforms

At the same time, China's battle against foreign exchange platforms has recently intensified.

The South China Morning Post recalls that China has blocked access to 124 crypto-exchanges outside the country, causing a 33% drop in volumes recorded on seven of the most popular platforms among Chinese traders.

Terence Tsang, the director of operations of the Hong Kong platform TideBit, said:

"The recent warning and potentially increased oversight on foreign platforms includes some small platforms that have registered as foreign entities, but are actually operating from China, and that have outsourced their operations by designating a Chinese company ".

Last March, the People's Daily - the official press organ of the Central Committee of the Chinese Communist Party - criticized the crypto-media, claiming that they manipulated the markets. The following month, WeChat blocked their accounts, saying they did not follow the rules for email applications.

AliPay and WeChat Pay said they would work with Chinese regulators to monitor and prevent crypto transactions on their platforms.