On October 10, the Alipay Security Center posted a post on Weibo, reaffirming its attitude towards over-the-counter transactions of virtual currencies: it is forbidden to use Alipay for virtual currency transactions. If it is found that the transaction involves Bitcoin or other virtual currency transactions, Alipay will Immediately stop the relevant payment services.
For merchants involved in virtual currency transactions, they will be resolutely cleared; for personal accounts involved in virtual currency transactions, according to the circumstances, measures such as restricting the account’s collection function, or even permanently restricting collections, will be taken.
Subsequently, WeChat Pay also issued a statement on its attitude towards virtual currency, saying that WeChat Pay does not support virtual currency transactions, and that any use of WeChat Pay for virtual currency transactions will be cleared and refunded.
The strong statement of the two payment giants detonated the entire currency circle, because it concerns every investor in the currency circle. Once we lose the fiat currency channel, it will be difficult for us to convert the renminbi in our hands into currency, and it is also difficult to convert the currency in our hands. Cash out into RMB. There is a question here.
It has always been like this before, and Alipay and WeChat have never supported it.
The cause of the incident is likely to be related to Binance’s high-profile OTC listing. In the past, exchanges such as Huobi, OK, and GATE were secretly launched in the over-the-counter trading area, and there was little publicity. Before Binance launched OTC this time, everyone knew about it. Zhao Changpeng's post on overseas Twitter was also stunned by Alipay.
Isn't this hitting at the point of the gun? No wonder Alipay and WeChat have issued statements to retaliate strongly in order to clear the relationship.
Investors in the currency circle are really making money selling cabbage, and they are being surrounded and suppressed everywhere because of the heart of selling white fans.
The Difficult Road to Currency Trading
Fiat currency trading stage: In the past, it was possible to trade bitcoins with fiat currency on exchanges, that is, to transfer money directly to the exchange and trade through RMB trading pairs.
Currency trading stage: After 1994, all domestic exchanges closed RMB trading, and the exchanges have gradually withdrawn user funds, while Binance’s currency trading does not involve legal currency, so there is no need to return currency and money, and undertake the flow and funds of other exchanges , began to rise all the way, and currency trading became the mainstream.
Over-the-counter trading stage: There is no legal currency channel, otherwise how will funds enter the market, so OTCBTC and other over-the-counter trading platforms have been launched one after another. OTC transactions are similar to the "Taobao model", where users trade directly with users and merchants. After the transaction is completed, the currency is transferred to the currency trading area for transactions.
OTC fiat currency transactions are different from overseas fiat currency transactions. For example, Coinbase Exchange, which is the world's largest compliant exchange, trades against USD and does not require stable coins. Users can directly settle transactions in USD without legal risks.
Domestic OTC transactions of legal currency are side-effects, and users face extremely high risks, because a lot of black money will flow into it, causing many people to sell their coins, and their bank cards and Alipay accounts will be frozen directly, and in severe cases, they will even go in and be locked up for a few days.
Anyway, users at least have channels to conduct transactions, so this time Alipay and WeChat have strongly expressed their views. Does it mean that the entrance of legal currency will become narrower and narrower in the future?
Will the legal currency entrance be blocked?
First answer a question, is Bitcoin illegal?
Many people have the impression that Bitcoin has been suppressed and involves money laundering, so it should be illegal.
In fact, everyone is very vague about whether Bitcoin is illegal. Let’s start by citing the Shenzhen Court of International Arbitration’s public publication of an arbitration case involving a dispute over an equity transfer contract involving bitcoin and other special objects.
The content of the specific case will not be described, and the results and the attitude of the court will be directly stated.
The arbitral award in this case recognized the legality of private holding, legal circulation, delivery and other behaviors of Bitcoin and should be protected by law as property.
Cryptocurrencies such as Bitcoin simply cannot be used as currency (i.e. legal tender) in the market. However, as a commodity, it is protected by law, and there are no laws and regulations prohibiting it from being the object of private delivery or circulation.
So rest assured, holding and trading Bitcoin is not illegal.
Back to the topic, will the access to gold be blocked?
It is almost impossible, because the user's transaction object is not an exchange, but an individual. Like Taobao, your transaction object is not Alibaba, but countless merchants. Users who have used OTC transactions should also know that every time you transfer money, you transfer to your personal account. Whether it is Alipay, WeChat, or bank cards, daily transactions are very frequent, and how to identify whether to participate in cryptocurrency transactions is a big problem.
No matter how strict the crackdown is, it is impossible to completely block it. In addition, Alipay and WeChat are not the only two payment platforms in the market. As long as the regulatory authorities do not take a stand on OTC, other payment platforms, such as those of JD.com, Baidu, and NetEase, can also take the opportunity to fill the gap in the market.
Where there is demand, there must be a market. As long as there is a market, it cannot be completely blocked. There will be countless new solutions to replace the original solutions.
How to avoid the risk of freezing in over-the-counter transactions
At present, the main reason why over-the-counter transactions are frozen is that black money is involved, and point-to-point transactions such as OTC are almost impossible to completely prevent the entry of black money. As long as you go to the exchange to trade over-the-counter, there is a certain probability of receiving black money. The only thing we can do is reduce the risk.
1. Do not note any information about the transaction when transferring funds
In China, many banks and payment platforms do not allow accounts to participate in digital asset transactions (for example, due to the remark of BTC, ETH, USDT, etc. during the transfer, the bank’s risk control system will detect it), once caught, the account will be frozen. Or suspend some permissions.
2. Choose a big merchant
For example, on Huobi OTC, if you choose Blue Shield as an advertiser, Blue Shield has strict assessment standards, and once the user account is frozen, there is a compensation agreement to assist in unfreezing.
Despite this, Huobi has been frozen the most, which may be related to its large transaction volume.
3. Reduce transaction frequency
There is nothing wrong with buying coins. Generally, selling coins is easy to be frozen, so try to reduce the frequency of selling coins. The more frequently you sell, the higher the probability of being shot. It does not mean that if there are few transactions, you will not be frozen. The key is whether black money has flowed into your account. Someone was shot for the first time selling coins.
In short, this is a probability game. Reducing the frequency can reduce the probability of being shot, and the most important thing is luck.
4. How to deal with being frozen?
If your bank card is frozen by the bank on suspicion of money laundering, it is recommended that you bring your personal ID card and a certificate that can prove the legal source of your income in the bank card to the bank counter to inquire about the specific reasons, and then entrust a lawyer to intervene, explain the situation, and provide Favorable evidence requires timely thawing.
There is almost no solution to the risk of black money in over-the-counter transactions, because it is a peer-to-peer transaction. Only when the exchange is compliant can the problem be eradicated. As long as there is non-compliance for one day, the risk of selling coins being frozen will always exist.
episode
After Alipay issued a statement, He Yi made a high-profile statement under Alipay Security Center Weibo to encourage the encryption community and advertised for BNB. Although this is out of good intentions, and there is nothing wrong with advertising for one's own brand, there is a Chinese saying: shoot the bird that stands out. Such a high-profile reply could backfire and even scare BNB holders.
The country as a whole is still very disgusted with Bitcoin, and the policy is also extremely tough. This is inseparable from the properties of cryptocurrency itself suitable for money laundering, especially in the case of economic downturn, the flight of funds is more serious, and the suppression of Bitcoin at the national level will only increase.
Although Binance’s high-profile actions have created momentum for its OTC, it may also attract the attention of regulators to the OTC business in the currency circle, which will cause fire.
