BITCOIN

Bitcoin tumbles as China issues new warning to digital currency exchanges

TAGs: Bitcoin, China, PBOC

The People’s Bank of China (PBoC) is laying out the ground rules for companies dealing with digital currency in the country.

Reports surfaced that officials from the central bank called in several of the country’s digital currency exchanges for closed door meetings this week. PBoC confirmed the reports and added that Wednesday’s meeting was broader than the ones held earlier this year, with a number of lesser-known bitcoin and cryptocurrency exchanges in attendance.

Among those who attended the meetings were BTC Trde, Yunbi, HaoBTC, CHBTC, BTC100, BitBays, Yuanbao, Dahonghuo and Jubi.

PBoC indicated on its website that it has issued specific instructions to the Bitcoin tumbles as China issues new warning to digital currency exchangesdigital currency exchanges, stressing the need for platforms to enforce anti-money laundering (AML) and foreign exchange regulations.

“If the exchanges violated the above requirements, and if the circumstances were serious, the inspection team may ask the relevant departments to close down the exchanges according to law,” the central bank said in a statement.

The announcement comes several weeks after PBoC started its crackdown on bitcoin companies in China.

In January, PBoC officials discovered “irregularities” in the operations of three of China’s biggest bitcoin exchanges—BTC China, OKCoin and Huobi. According to the central bank, the three were found to offer a loan feature called margin trade, which the PBoC said not only violates the country’s rules but has also caused bitcoin’s recent volatility. BTC China was also found to have been offering loans, which the central bank said is beyond the scope of its business as a bitcoin exchange.

This prompted Huobi, OKCoin and BTC China to officially begin charging 0.2 percent trading fees per transaction to all of their users, triggering a decline in volume at these three exchanges.

Current bitcoin price

News of the PBoC meeting with domestic bitcoin exchange platforms has caused the price of the popular digital currency—which has been enjoying its one-month high of $1,070—to fall by 1.77 percent.

The price of bitcoin sits at $1,057 during Thursday morning’s trading.

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