Bitcoin exchanges 'await official clarification' on closure reports

Updated 2017-09-12 09:30:23 Global Times/Agencies

China's largest Bitcoin exchanges said on Monday they were awaiting clarification from the government following more media reports that China will ban trading of virtual currencies on domestic exchanges.

Spokeswomen for the OkCoin and Huobi platforms told Reuters they had no information to share following a report by Chinese financial publication Caixin that sent the price of Bitcoin down 6.6 percent on Friday.

Caixin reported that China planned to shut down local crypto-currency exchanges. Bloomberg and the Wall Street Journal issued Monday similar reports, saying that China was drafting a plan to ban commercial trading of all virtual currencies.

BTC China, also one of China's three largest exchanges, and China's central bank did not immediately respond to Reuters' requests for comment.

China has boomed as a crypto-currency trading venue in recent years as its domestic exchanges had allowed users to trade for free, attracting investors and speculators who boosted demand and encouraged volume.

However, regulators started taking a closer look at the industry in January this year, and they later announced rules for the industry such as forcing exchanges to charge trading fees and requiring them to strengthen oversight of customers' identities.

The latest media reports follow China's move last week to ban "initial coin offerings," or the practice of creating and selling digital currencies or tokens to investors to finance start-up projects.

Xue Hongyan, director of the Suning Financial Research Institute, the research arm of one of China's largest fintech service providers, said in an article posted online that the latest reports suggest that the rules are not aimed at the virtual currencies but rather trading of them.

"The virtual currency itself is not the problem, but the illegal behaviors that the virtual currencies enable are where the problems lie," he said.

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