In a new report on monetary stability from the People’s Bank of China (PBoC), China’s financial organization said that “disguised ICOs” continues to appear within the country, despite regulators’ best efforts at cracking down on them.

Initial coin offerings (ICOs) and cryptocurrency trading were made illegal in China in late 2017, because the government wanted to safeguard investors from what it deemed risky investments, as well as making an attempt to better control illegal capital outflows.

In the new report, titled China financial Stability Report 2018 (in Chinese), the financial organization admitted that numerous types of crypto-related activities are still occurring within the country.

Although several players, together with a number of the world’s largest cryptocurrency exchanges by trading volume, have moved out of the country, the companies still supply their services on the Chinese mainland. Some have even found inventive ways to avoid the ban on crypto investments by using “agents” set overseas to invest on behalf of Chinese investors, the report noted.

According to the document, another strategy utilized by some crypto ventures that are issuing new tokens is to give away free tokens in a very so-called airdrop rather than selling tokens to the general public. The issuer reserves some of the tokens for itself that it will later sell within the secondary market once the value has risen, therefore profiting from the free token issuance.

The central bank noted that progress has been made in “the clean-up and rectification” in the cryptocurrency space, however, said “severe crackdowns on violations on laws and regulations” are still required to “guide funds back to the real economy.” It conjointly added that “strengthened domestic regulatory coordination,” as well as international cooperation would be required to face the challenges posed by the emerging asset class.

In June, an officer at the People’s Bank of China claimed that Chinese regulators have “basically completed” clearing out ICOs and crypto exchanges from the country when a year of strong efforts to crack down on the platforms. A month later, Zhang Yifeng, dean of the Zhongchao Blockchain Technology Research Institute, one of the earliest institutes to review distributed ledgers and cryptography in China, said that the Chinese government has succeeded in containing risks arising from cryptocurrency trading within the country.

However, as previously reported by TopMarketGroup there are still a variety of ways Chinese crypto investors and connected corporations use to avoid the restrictions imposed by the Chinese government, together with the utilization of virtual private networks (VPNs), encrypted electronic messaging apps, and trading platforms operated from overseas. Moreover, despite the Chinese central government’s best efforts to drive bitcoin miners out of the country, miners in the additional remote interior regions, together with Sichuan and Qinghai Province, have shown a shocking resilience.

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