PBoC Issues Decree To Chinese Cryptocurrency Exchanges
The People’s Bank of China (PBoC) intends to issue an administrative notice to Chinese bitcoin exchanges OKCoin, Huobi, and BTCChina (BTCC). All three exchanges have been urged into limbo since the PBoC halted withdrawals in February. According to cnLedger, new regulations may be released in June, which could signal the resumption of transactions.
The PBoC’s announcement comes after the central bank initiated inspections of all three exchanges on January 11 to investigate suspected rules violations. Caixin reports that during the inspection, the central bank found it illegal to finance a business with bitcoin and that the anti-money laundering (AML) internal control system was not well established. As a result, OKCoin, Huobi, and BTCC could be penalized.
2/ Official regulation details on bitcoin trading platforms and bitcoin AML standards still under work, may be released in June— cnLedger (@cnLedger) May 10, 2017
The investigations forced the exchanges to halt withdrawals and stop offering margin loans to their customer bases so they could conduct system audits and attempt to meet PBoC guidelines. However, these audits were met with resistance when Zhou Xuedong, PBoC director of business management, proposed an “observation period” to suggest new regulatory rules that would maintain financial stability and protect the interest of investors.
“We have to calmly and rationally look at the non-physical, anonymous, and distributed global characteristics of Bitcoin, making it an uncontrollable special digital asset, while its innovative block-tier technology boosts the financial industry Technology upgrades and financial technology (FinTech) industrial development.”
Despite the exchange debacle, bitcoin has continued to rise to new heights and current prices are roughly close to 10,000 yuan in all Chinese Exchanges.
As this story develops ETHNews will continue to provide coverage.