During the last couple of months, the attitude of Chinese authorities towards Bitcoin and Bitcoin Exchanges has become quite offensive, considering the numerous threats made towards exchanges that do not fully comply with the regulations put in place by the Chinese Government.
Recent reports indicate that a couple of major Chinese bitcoin exchanges, including BTCC, will now stop both bitcoin and litecoin withdrawals for a month. This particular suspension will likely last until the 15th of March, as BTCC and other exchanges try their best to comply with the new set of regulations put into place by the Chinese authorities, as a direct crackdown towards exchanges.
On their website, BTCChina mentioned that they are now upgrading their customer verification system, in order to better investigate possible money-laundering accounts, hence applying the norms being enforced by the People’s Republic Bank of China. In a recent press statement, a representative from the popular exchange has mentioned that: BTCChina will continue upgrading its inspection and verification system for bitcoin and litecoin withdrawals to aggressively guard against money laundering, illegal money exchange, pyramid schemes, and other illegal activity. As a result, bitcoin and litecoin withdrawals will be suspended from February 15th until March 15th.
It is important to keep in mind that this suspension will likely not affect most of the exchange’s Chinese customers, considering the fact that yuan-based withdrawals and deposits are still accepted. However, US Dollar withdrawals will be suspended for the coming month.
To give some more perspective into the conflict between bitcoin exchanges and the Chinese government, it is worth pointing out that the People’s Bank of China recently started investigation all bitcoin exchanges operating in the country, possibly to reduce the amount of capital flowing out of the country. Following the investigations, the PBoC went ahead and brought an end to both zero-trading fees, but also margin trading, which was highly popular in the region. Therefore, trading activity for bitcoin, but also the bitcoin price have all been affected by the decision.
However, after the decision to suspend withdrawals, it seems like the price of the digital currency did not take much of a beating, hence remaining the same after the news was published, which is definitely great news. However, the decision to suspend trading in order to implement better protocols will likely benefit exchanges in China in the long run, as they’ll be able to operate for many years to come, without facing other issues, and risking closure by the Chinese Government and its financial authorities.
Based on everything that has been outlined so far, what do you personally think about the decision to suspend US dollar withdrawals by the BTCC bitcoin exchange? Has this decision affected you personally? Let us know your thoughts in the comment section below.