China's Internet finance body urges members not to deal in cryptocurrencies

[SINGAPORE] China's Internet finance association on Wednesday urged its members not to take part in any centralised virtual currency trading or provide services involving cryptocurrency trading due to the financial and social risks.

China has been cracking down on fundraising through launches of token-based digital currencies, targeting initial coin offerings in a market that has ballooned this year.

"We urge all our members to exercise self-regulation and strictly abide by laws by not participating in any centralised trading or provide services for this type of trading," the National Internet Finance Association of China said in a notice on its website www.nifa.org.cn.

The state-backed association is set up by the central bank and has members such as banks, brokerages, funds and consumer finance companies.

China's largest bitcoin exchanges, such as OkCoin and Huobi platforms, are awaiting government clarification following media reports that Beijing is planning to ban trading of virtual currencies on domestic exchanges.

Investors in China contributed up to 2.6 billion yuan (S$532 million) worth of cryptocurrencies through ICOs in January-June, according to a state-run media report citing data from the National Committee of Experts on Internet Financial Security Technology.

The value of cryptocurrencies has jumped, and authorities are wary of a potential bubble forming.

REUTERS