Tech

China's central bank urges Alipay and banks to crack down on crypto speculation

Key Points
  • The People's Bank of China said it summoned payments firm Alipay and several major lenders to tell them they must not provide crypto-related services.
  • In May, China said financial institutions and payment companies were banned from providing services related to crypto transactions.
  • Bitcoin's price fell to a two-week low Monday on news that China's clampdown on crypto mining has extended to the southwestern province of Sichuan.
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China presses banks to crack down on providing cryptocurrency services

China's central bank on Monday said it had urged several payment firms and banks to clamp down on cryptocurrency speculation, adding to calls from Beijing for restrictions on bitcoin and other digital currencies.

The People's Bank of China said it summoned major lenders including the Industrial and Commercial Bank of China and the Agricultural Bank of China, and Alipay, the mobile payments service run by Alibaba affiliate Ant Group, to tell them they must not provide crypto-related services.

The comments reinforce Beijing's hard line on crypto. In 2017, the Chinese government banned so-called initial coin offerings, a way to issue new digital tokens and raise money. Authorities have also cracked down on businesses involved in crypto operations, such as local exchanges.

In May, China said financial institutions and payment companies were banned from providing services related to crypto transactions.

Alipay said Monday it would "continue to conduct a comprehensive investigation and strike against virtual currency transactions" and "intensify" its crackdown on crypto.

"We reiterate that Alipay does not conduct or participate in any business activity related to virtual currencies and does not provide any assistant technical service or capability," the company said, according to an English translation of a post on the social media site Weibo.

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"Alipay will immediately cut its payment service related to any virtual currency transaction it spots. Alipay will firmly remove any merchant involved in virtual currency transactions."

Bitcoin's price fell to a two-week low Monday on news that China's clampdown on crypto mining has extended to the southwestern province of Sichuan, a region known for its rich hydropower resources.

-- CNBC's Arjun Kharpal contributed to this report.