Bitcoin and other cryptocurrencies are touted as being resilient to governments and financial institutions and its biggest test is coming from the East.

Earlier this month China issued a ban on the trading of initial coin offerings in what has since become a crackdown on cryptocurrencies at large.

Now China is issuing a missive to cryptocurrency exchanges in Beijing as well as Shanghai to submit plans on how they intend to wind down operations by 20th September according to a report by the BBC.

Over and above potentially having to close their doors, exchanges are to stop registering new users on 15th September and submit all user trading and holding data to local authorities.

The Chinese government believes that cryptocurrency is being used as a tool for criminal activities such as money laundering, smuggling and illegal fundraising among others.

Staff working at exchanges in Shanghai and Beijing have been ordered not to leave the city and work with authorities during the shut down.

While the shutting down of exchanges does sting, the anonymous nature of currencies such as Bitcoin does lend itself to being used by nefarious individuals or groups.

With that having been said criminals have been around for a lot longer than Bitcoin has been and while other financial institutions are heavily regulated cash is not and we are at a loss when it comes to thinking of the last time a criminal turned down a cash payment.

[Image – CC 0 Public Domain MichaelWuensch]
Brendyn Lotz writes news, reviews, and opinion pieces for Hypertext. His interests include SMEs, innovation on the African continent, cybersecurity, blockchain, games, geek culture and YouTube.