The China Internet Finance Association has signed a joint statement with the China Banking Association and China Payment and Clearing Association, warning the public about the risks of investing in cryptocurrencies.
According to a report by Shanghai Securities News on Tuesday, the aforementioned trade association under the People’s Bank of China issued a communique titled “Preventing the risk of virtual currency transaction speculation.”
The joint statement is reportedly an extension of previous releases from the PBoC about Bitcoin (BTC) and crypto risks.
As part of the communique, the three associations outlined four issues related to crypto investment beginning with a call for its members to understand the nature of virtual currencies.
According to the release, cryptocurrencies are not “real currency” and should not be used as a medium of exchange for goods and services.
Back in July, the Beijing Arbitration Commission issued a ruling declaring Bitcoin to be a virtual commodity.
For its second point, the trade associations warned financial institutions and other member organizations not to engage in crypto business transactions. An excerpt of the document specifically addressing internet platforms reads:
“Internet platform corporate member units shall not provide services such as online business premises, commercial displays, marketing promotion, paid diversion, etc. for virtual currency-related business activities. If clues or related problems are found, they shall promptly report to relevant departments and provide technical support for related investigations and assistance.”
The trade associations also warned retail traders to be wary of the risks involved in crypto investments while also calling on member institutions to abide by existing regulatory provisions regarding virtual currencies.
China banned token issuance and crypto trading back in 2017 forcing major exchanges to move their operations out of the country. This action has been followed by a host of often conflicting statements on crypto with the government seeming to favor the “blockchain not Bitcoin” narrative.