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China Bitcoin Exchange Ban ‘Certain’; BTCC to Suspend Trading; Shanghai Issues Verbal Shutdown Order: Reports

Last Updated March 4, 2021 4:59 PM
Josiah Wilmoth
Last Updated March 4, 2021 4:59 PM

Chinese regulators have reportedly stated that a bitcoin exchange ban is “certain”. Meanwhile, Shanghai has issued a verbal shutdown order to bitcoin exchanges based in the city, and BTCC has announced it will suspend trading by the end of September.

This morning, Zero One Finance–a member of the China Internet Finance Association (NIFA)–published a newsletter  stating the Chinese regulators had “asked the major currency exchanges to close the program,” according to a rough translation. “Banning Bitcoin exchange is certain,” the regulator continued. The bitcoin exchange ban should take place within the next several months.

This comes just one day after NIFA–a self-regulatory agency established by the People’s Bank of China (PBoC)–issued a statement warning its members about the risks of cryptocurrency exchanges and admonishing them to not operate or engage with them. NIFA has issued a similar statement about initial coin offerings (ICOs) shortly before the PBoC placed a blanket ban on ICOs.

Also this morning, Bloomberg China’s Lulu Yilun Chen reported  that the Shanghai Financial Office had “verbally halted” Shanghai exchanges, the largest of which is BTCC. This was confirmed by Yicai Global, the largest official media source in Shanghai. Citing people familiar with the matter, the Yicai Global report  stated that the shutdown order would go into effect by the “end of September.”

BTCC tweeted that they would suspend trading on September 30, although their other operations–including BTCC Pool–would continue. BTCC did not immediately respond to a request for comment.

Earlier this year, the PBoC began conducting on-site inspections of Chinese bitcoin exchanges. In cooperation with the Shanghai Financial Office, PBoC officials had visited BTCC and ordered it to begin taking unspecified steps to comply with regulations.

Predictably, the bitcoin price has begun to crash on Chinese bitcoin exchanges. At the time of writing, BTC/CNY had dropped to $3,251 on BTCC, $3,362 on OKCoin, and $3,321 on Huobi. This forced the global average bitcoin price down to $3,667.

Featured image from Shutterstock.