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WeChat, the popular Chinese messaging app owned by Tencent (TCEHY), has released an update to its Payment Service Protocol that bans merchant users from trading or engaging with cryptocurrencies.

As first pointed out by Dovey Wan, founding partner of crypto investment firm Primitive, WeChat’s new policy means that merchants will be banned if they service any token project or fund.

The rules will kick-in on May 31, and Wan has expressed concern over the impact of the restriction on local over-the-counter (OTC) crypto trading liquidity, as most of China’s current bitcoin buying takes place over the counter due to government restrictions.

Commenting on the matter, Binance CEO Changpeng “CZ” Zhao stated, “This is a classic example of short term pain, long 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.”

CZ also added that while WeChat has the best user interface for payments, the added restrictions will likely work against its user retention.

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This news comes after WeChat blocked cryptocurrency and blockchain-related media outlets from its platform last August.

China’s National Development and Reform Commission (NDRC) also recently unveiled amendments to the guidance for the country’s industrial structure, with crypto mining categorized as an undesirable sector that should be eliminated immediately

More: Updated Policy
Related: Multiple Crypto Media Outlets Banned From Tencent’s WeChat
Image: Sinchen.LinFlickr

Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.

Voyager

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