Central bank warns bitcoin exchanges
February 13, 2017 Category Finance, Weekly
The People’s Bank of China (PBOC) warned that it will close bitcoin exchanges which breach rules on money laundering and foreign exchange. The PBOC met with executives from nine bitcoin exchanges, including Huobi, OkCoin, BTCC and HaoBTC, in Beijing and ordered them to operate according to the law. “Trading platforms should not participate in unauthorized financing business, conduct money laundering, or violate regulations on foreign exchange, tax and business,” the PBOC said in a statement. Platforms that breach the rules will be investigated and shut down, it warned. In response, OkCoin and Huobi said they’ve halted bitcoin trading and it will not resume until completing a system upgrade to prevent money laundering. Huobi also said it will “block accounts that are suspected of illegal practices.” HaoBTC will limit investors to trade no more than 5 bitcoins within 48 hours, and will also raise the trading fee to 0.4% per transaction from 0.2%. “Investors should always remember that bitcoin lost more than 75% of its value in 2013,” said Zhang Yufang, Investment Adviser with Shanghai Shangding Investment Consultancy. The price of the virtual currency was little changed around CNY7,500 after the PBOC statement was released, the Shanghai Daily reports.
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