Traders in China are making use of virtual private networks (VPNs) as a tool to elude the current government crackdown on cryptocurrency trading.

 

This is according to local media outlet South China Morning Post (SCMP).

According to SCMP, citing reports from Beijing-affiliated Shanghai Securities Times, traders have started leveraging Tether (USDT) as a way of entering and leaving cryptocurrency markets.

 

When used with a VPN, two traders can use an exchange platform registered outside China as a halfway to exchange cryptocurrency for fiat currency and vice versa.

“[T]wo individuals who have both completed a ‘know-your-customer’ procedure with an exchange would swap ‘fiat’ currencies […] to tether,” said the report, which continued:

 

“The exchange plays the role of an overseer of such trades, and stands ready to adjudicate in cases of failed trades, or transactions that are not honoured.”

A Beijing district ramped up the ban on cryptocurrency exchanges last month, looking to prohibit more than 120 websites of platforms that were seeking to serve would-be domestic consumers.

This, Hong Kong and Taiwan exchange TideBit CEO Terence Tsang was quoted as saying, is “targeted at a batch of smaller exchanges that had claimed to be foreign entities, but are in fact operating in China claiming they have outsourced their operations to a Chinese company.”

 

At the same time, the report noted, there is no successful scheme in operation to block VPNs, permitting smarter traders to keep their access to forbidden online resources.

Chinese traders have tried other means of crypto trading since officials first began started the ban on the practice in September 2017. This includes using Hong Kong as a home from home for platforms themselves, while traders have also turned to peer-to-peer options, something the Chinese government has now also sought to put a stop to.