A Chinese court yesterday ruled Futures trading on exchanges is illegal gambling and against Chinese anti-gambling laws.
The Court reacted to a Chinese exchange BKEX 1000 leverage which it called inappropriate and used to promote bets on Price movements.
Employees and external promoters working with the exchange were prosecuted by the court. They were eventually let off with suspended sentences following the incident.
BKEX is a cryptocurrency exchange that provides spot trading, futures trading, staking, and other financial services for digital assets.
The crypto exchange is often associated with China but is officially registered in the British Virgin Islands, and serves a global user base.
Due to China’s crypto ban, BKEX does not operate legally within mainland China but serves international users.
China’s Stringent stance on Gambling remains unchanged
China has one of the strictest anti-gambling laws in the country with harsh penalties for defaulters.
All forms of gambling are banned in China except for state-run lotteries under the firm control of Chinese authorities.
State-run lotteries like China Sports Lottery & China Welfare Lottery are the only legal lotteries in the country.
Other forms of gambling like Casinos, online gambling, and private betting are strictly illegal. Operating or promoting gambling can lead to fines, imprisonment, and asset seizures.
Crypto remained banned in China
The Chinese government has maintained a stringent stance against cryptocurrencies since 2021 banning activities like trading, mining, and initial coin offerings (ICOs).
The People’s Bank of China declared all cryptocurrency transactions illegal in 2021 confirming the ban and making it official.
Despite these prohibitions, underground cryptocurrency activities persist within the country. Individuals and entities continue to engage in crypto transactions through over-the-counter (OTC) networks and peer-to-peer trading.
Adamant Chinese citizens often utilize offshore platforms and stablecoins like Tether (USDT) to bypass capital controls.
These clandestine operations pose challenges to Beijing’s efforts to regulate financial flows and maintain economic stability in the country.
Before the ban, China had the highest number of Bitcoin miners in the world. Many miners were forced to relocate after the ban became official to protect their interests.
