85% of Blockchain Firms in China have Attempted to Create and Issue Cryptos

Posted on Nov 25, 2019

The ‘Bluebook of Blockchain’ was published four days ago, which has highlighted illegal and fraudulent activity within the blockchain industry. The publication has been put forward by several financial and technology authority bodies, as led by the Chinese Central Bank. At the time of release, senior officials have indicated that nearly 25,000 blockchain companies have attempted to issue their own cryptocurrency tokens, and only 4,000 of these companies are solely focused on the application of blockchain technology.

The discoveries have been made in the government’s vigorous clampdown on financial operations that are disallowed, with regards to ICOs and trading in the crypto industry. The ICO is the most commonly used process for the issue of cryptocurrency, which the Chinese government previously regarded as illegal. The report has indicated that more than half of the blockchain companies are based in Guangdong, with the remainder operating out of Beijing or Shanghai. The latter two cities are planning to close down any crypto exchanges still actively running.

China currently allows the operating of cryptocurrency mining and possession of crypto assets, in addition to being an advocate for the adoption of blockchain technology. Yedong Zhu, President of the Beijing Blockchain Application Association, has stated the need to guarantee that the support programs provided by the government for blockchain technology do not include any firms which are undertaking illegal or fraudulent practice. The report has been released in order to navigate authorities on regulations with regards to the fintech industry, with two more reports released which are based on the types of technology used by regulators and fintech companies.