Did China ban crypto (again)? Here’s why the myth won’t die

The social media rumor mill once again started circulating news of a supposed fresh Chinese ban on all crypto assets.

If you follow the crypto community on X, it seems like China bans crypto every few months. On August 3, several social media accounts reported a supposed Chinese ban on crypto assets. These accounts claimed that the ban applies to both crypto trading and mining, as well as “related services.”

X post suggesting that China banned crypto, with an attached community note | Source: X

Still, it didn’t take long for users to point out past instances of supposed Chinese crypto bans. One user shared an overview of reports from 2013 to 2021, showcasing how rumors can have a significant impact on crypto.

In reaction, some users shared a humorous meme referencing South Park. The meme pokes fun at the crypto market’s irrational reaction to supposed big regulatory news from China.

Cropped South Park-themed meme showcasing the supposed Chinese crypto ban | Source: X

Why the Chinese crypto ban rumor won’t die

In reality, top Chinese regulators, led by the People’s Bank of China, implemented a full ban on all crypto transactions and mining in September 2021. Authorities cited concerns over energy usage as the main reason for the mining ban.

In addition, regulators were concerned about crypto’s use in illegal activities, as well as its role in facilitating capital flight. The country subsequently cracked down on illegal mining operations, pushing many of them to countries like Kazakhstan. Still, illegal mining operations persist in China, and crypto is still being used in bribery .

For crypto markets, regulatory news often has the biggest impact. Huge economies like China have the potential to significantly influence demand for crypto assets. At the same time, few traders outside of China follow its politics closely enough to verify unproven rumors.

For this reason, social media users looking for engagement will likely report that China banned crypto again in a few months.