Dubai-based cryptocurrency exchange Bybit has taken a cautious but bold step in accommodating mainland Chinese users, allowing them to trade on its platform through virtual private networks (VPNs).
In an interview with Cryptonews’ Rachel Wolfson at Consensus 2024, Seyffart discussed the timeline and approval process for spot ETH ETFs, including the 19b-4 rule change and the role of the SEC.
While this move reflects user demand and the company’s assessment of “acceptable risks,” Bybit has seen limited new user growth from mainland China due to its prohibition of yuan trading.
Zhou clarified that this also enables mainland users to bypass the country’s crypto ban using VPNs, though the exchange blocks direct access via mainland IP addresses.
According to a South China Morning Post report, Ben Zhou, co-founder and CEO of Bybit, announced on December 3 that the exchange began permitting signups using Chinese national IDs and passports earlier this year, catering to the “overseas Chinese community.”
Zhou explained that the Chinese government’s primary concern with cryptocurrencies lies in their potential to facilitate capital outflows, making yuan transactions a regulatory “red line” for the platform.
According to the report, this decision is a delicate balance between meeting user demand and adhering to regulatory boundaries.
Despite the regulatory hurdles, Zhou emphasized that Bybit’s measures aim to provide access without crossing the Chinese government’s most sensitive restrictions.
“What the Chinese government dislikes the most about crypto is that it can facilitate capital outflow, so we won’t touch this red line.” Ben Zhou
Mainland China, once a global leader in cryptocurrency adoption, has banned commercial crypto activities since 2021. Despite the ban, Chinese users continue to access crypto markets through unofficial channels, including peer-to-peer trading and VPNs.
Bybit’s approach reflects the broader challenges of operating in regions with complex crypto regulations.