China is set to continue a war on progress as Tech and Crypto firms are seen as a danger to complete State Control. But the moves are generating new business for other countries and shines a light on the long term value of Bitcoin and Crypto as a path to freedom.
If the Communists hate Crypto then it must be good.
Chinese regulators urged ride-hailing giant Didi Chuxin to delay its $4.4 billion New York IPO to examine security concerns, advice the company did not heed, according to a report.
Didi was banned from app stores on Sunday by the Cyberspace Administration of China (CAC), and now faces a probe over unspecified national security issues, in a move that stoked fresh concerns about Beijing’s crackdown on the country’s tech sector.
The watchdog attempted weeks before the bumper initial public offering to dissuade Didi from going ahead with it and urged the firm to launch an internal security probe, the Wall Street Journal reported Monday, citing unnamed sources familiar with the matter.
But the industry giant — dubbed China’s Uber, with more than 15 million drivers serving nearly 500 million users — went ahead with last week’s listing, which was one of the biggest in the United States for a decade.
Officials were “wary of the ride-hailing company’s troves of data potentially falling into foreign hands” owing to public disclosure around the listing, the Journal’s sources said.
Beijing’s scrutiny of Didi is the latest move in a wider crackdown on major US-listed tech firms and was followed hours later by the announcement of a review of truck-hailing platform Full Truck Alliance and the owner of popular online recruitment site Boss Zhipin.
All three platforms were told by the CAC on Monday to stop registering new users “to prevent security risks to national data, safeguard national security and protect public interest”.
While the CAC gave few details, Didi has pledged to rectify any problems and said the takedown “may have an adverse impact on its revenue in China”.
The crackdown also comes at a time of heightened tensions between China and the United States, with technology and national security major points of friction.
The timing of the ruling on Didi, coming so soon after the listing, was met with surprise by some.
But Xiaomeng Lu, a senior analyst at political risk consultancy Eurasia Group, told Bloomberg News: “Beijing is not pleased to see its national champions cosying up to foreign stakeholders.
“It also wants tech companies to keep their core assets — data and algorithms — in China.”
China’s central bank warned companies on Tuesday against assisting cryptocurrency-related businesses as it shut down a software firm over suspected involvement in digital currency transactions.
Beijing has turned a sharp eye on cryptocurrency in recent months as it widens its regulatory crackdown on the tech sector.
Cryptocurrency trading is banned in China, and authorities have recently closed mines and warned banks to halt related transactions.
On Tuesday, a Beijing office of the central bank ordered the closure of software company Beijing Qudao Cultural Development, alleging it had been involved in providing software services for cryptocurrency transactions.
The move was necessary “to prevent and control the risk of speculation in virtual currency transactions, and protect the safety of the public’s assets”, it said in a statement.
The bank also warned organisations not to “provide premises, commercial display, advertising… and other services for cryptocurrency-related business activities”.
Financial and payment institutions are instructed not to provide cryptocurrency-related services to customers.
The announcement comes shortly after provinces including Sichuan, Inner Mongolia and Qinghai shut down crypto mines — causing miners to look abroad — and follows an earlier warning for banks and a payment giant to halt crypto-related transactions.
Last month, bitcoin tumbled after China’s mining ban in southwestern Sichuan.
China is in the middle of a wide-ranging regulatory crackdown on its fintech sector, whose biggest players — including Alibaba and Tencent — have been hit with big fines after being accused of monopolistic practices.