Despite the crackdown on cryptocurrencies, Chinese traders are still trading them with Virtual Private Networks (VPNs).
VPNs + Tether: Cryptocurrency Trading
In fact, Chinese traders have been successfully using the tether (USDT) stablecoin to successfully enter and exit crypto markets without a problem. One US dollar backs every token issued for the Tether cryptocurrency.
This is the key to the power of the digital currency. In effect, Tether is a hybrid between fiat and digital currencies.
Tether makes transactions fast and charges no fee when transacting between two Tether wallets. Therefore, Tether is indeed very useful for investors. Moreover, Tether makes it possible to rapidly cash in and out in difficult market conditions.
Two traders who wish to trade can simply use VPNs and resort to an exchange registered outside of the country. The latter serves as an intermediary platform where one could swap cryptocurrency for fiat currency.
According to the South China Morning Post (SCMP), “[T]wo individuals who have both completed a ‘know-your-customer’ procedure with an exchange would swap ‘fiat’ currencies […] to tether. The exchange plays the role of an overseer of such trades, and stands ready to adjudicate in cases of failed trades, or transactions that are not honoured.”
According to the SCMP, there are are no plans to block VPNs, which will allow smarter traders to maintain access to cryptocurrency trading.
All, as Beijing intensifies clampdown on cryptocurrencies
Thanks to increased fears of financial insecurity, authorities blocked access to hundreds of sites operated by offshore cryptocurrency exchanges.
It also banned payment services from accepting cryptocurrencies, including bitcoin.
However, it’s not just cryptocurrency firms facing the heat, though.
The country is also going after hotels, office buildings, and shopping malls, too. None of them can host marketing events involving cryptocurrencies any longer. The government is also using WeChat to tighten the flow of information on cryptocurrencies. This is part of a larger effort to regulate social media, an important channel to cryptocurrency traders.
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