The Chinese social media giant and payment service provider WeChat banned cryptocurrency transactions in its payment policy, as the latest cryptocurrency news show. The story that WeChat bans crypto transactions went viral after Dovey Wan, who is the founding partner of the crypto investment firm Primitive, tweeted the news on May 7.
In the tweet, there was a screenshot of the policy changes which leads to the fact that all of the user profiles which engage in crypto trading will be completely terminated. According to Wan, there is concern that most of the over-the-counter (OTC) transactions are happening in WeChat.
“This may impact local liquidity to quite some extent,” Wan admitted that WeChat bans crypto transactions.
Currently, WeChat is one of the most popular messaging and payments service providers in China featuring game integrations. The updated rules will come to force on May 31 and state that “merchants may not engage in illegal transactions such as virtual currency,” as well as the issuance of tokens, selling pornography or online gambling.
Knowing that WeChat bans crypto transactions, Changpeng Zhao who is the founder and CEO of the major cryptocurrency exchange Binance, commented on the restrictions, saying that they have been forced on the company. Zhao also defined the developments as “a classic example of short term gain.”
“It is inconvenient for people short term, and they take a hit. But long term, it is precisely this type of restriction of freedom that will push people to use crypto. Not a bad thing,” Zhao explained while noting that now that WeChat bans crypto transactions, the user experience offered by the platform will be easy to be beaten.
The news went viral on many best cryptocurrency news sites.
WeChat Pay has reportedly registered a total daily transaction volume of more than 1 billion (currency not specified) while the number of users allegedly reached 1.098 by the end of the last year. Now that WeChat banned crypto transactions, all of these accounts will be terminated – including the ones from Chinese users.
At the end of January 2019, news broke that WeChat Pay’s main competitor Alipay requested the crypto exchange Huobi to remove their payment services from its over-the-counter (OTC) trading desk.
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