Following findings of “irregularities” in the business and operational processes of the big bitcoin exchanges in the country, China’s central bank (PBOC) has now announced that its on-site inspections of the “Big 3” bitcoin exchanges is set to continue.
In a statement today, the Beijing branch of the People’s Bank of China has stated its intention to continue on-site inspections of bitcoin exchanges will continue after the findings of preliminary inspections that took place a week ago.
At the time, the PBOC Beijing had announced that OKCoin and Huobi, two Beijing-based bitcoin exchanges had not set up or followed the required anti-money laundering norms within its platforms. PBOC Shanghai had issued a separate notice stating that BTC China had been functioning beyond the scope of its business by offering leveraged (margin or loan) trading to Chinese citizens.
Those findings, among other “problems found” has led to this (loosely translated) PBOC Beijing notice today:
According to the initial inspection and the problems found, the inspection group decided to continue to focus on areas of payment and settlement, anti-money laundering, foreign exchange management, information and financial security and other aspects of further inspection. Investigators also suggest that investors should pay attention to bitcoin platform transactions and activities such as legal compliance, market volatility, financial security and other risks, with careful participation in bitcoin investment activities.
It is yet unknown if the on-site inspections pertain to OKCoin and Huobi specifically or if they include Shanghai-based BTC China as well.
A number of changes concerning the trading and operational activities of the major Chinese bitcoin exchanges have already been made, since the PBOC got involved on January 6, sending bitcoin prices crashing. Chief among the changes are the suspension of margin trading by the platforms (confirmed formally last week) and the inclusion of trading fees, the latter which came into effect yesterday.
While trading volumes have been impacted following the changes, particularly after the introduction of trading fees which saw volumes crash upwards of 80% across major exchanges, bitcoin price has remained largely unchanged.
At the time of publishing, following the PBOC’s latest statement from hours ago, bitcoin is trading at beyond 6200 yuan (approx. $905) at BTCChina.
The Bitstamp Price Index (BPI) is also seeing predominantly stable values, now trading at $897 at the time of publishing.
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Last modified: June 14, 2020 9:33 AM UTC