Just when bitcoin thought it was safe, it turns out Chinese regulators aren’t done with their investigation into domestic bitcoin exchanges. The People’s Bank of China (PBoC) in Beijing reportedly met with nine small bitcoin platforms, said The Wall Street Journal, on Wednesday afternoon, asking a wide variety of questions, including some that were reportedly related to anti-money laundering.
Bobby Lee, CEO of Shanghai-based bitcoin exchange BTCC, was quoted by WSJ as saying: “It’s an open secret that the PBoC is not happy to see bitcoin prices go up. With the recent rise, they’re taking actions to see the price go down.”
Bitcoin prices have continued to rise, recently breaking $1,000 in value for the second time this year. At the time of writing, bitcoin was worth $1,061.20.
Last month, the PBoC launched a probe into major bitcoin exchanges in Beijing and Shanghai, including BTCC, Huobi and OKCoin, investigating possible instances of market manipulation, money laundering and unauthorized financing.
Current Chinese regulations limit foreign exchange to $50,000 each year, but some believe that people are using bitcoin and other digital currencies to circumvent this maximum. In response to the probe, major Chinese bitcoin exchanges restricted margin trading and introduced trading fees. BTCC, Huobi, and OKCoin now charge traders a flat fee of 0.2 percent per transaction.
Chinese bitcoin exchanges account for over 90 percent of worldwide trading, and over 80 percent of bitcoin mining operations are currently stationed in the nation of some 1.3 billion.
A shift in Chinese demand or a sudden increase in investor concern has been shown to have a dramatic effect on the value of the popular digital currency. The future of bitcoin in China is uncertain as of now as the PBoC continues its investigation. But one thing is for certain — if bitcoin goes down in China, it’s more than likely to go down for good.
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