China to ban Bitcoin and other Cryptocurrency exchanges

Tammy Harvey
September 12, 2017

China plans to ban trading of bitcoin and other virtual currencies on domestic exchanges, dealing another blow to the $150 billion cryptocurrency market after the country outlawed initial coin offerings last week.

China has been casting its shadow on the price of cryptocurrencies in the past week.

Although bitcoin is being traded at around $4,000 in China, almost $200 lower than the United States market, Chinese exchanges have demonstrated low trading rates for the bitcoin-to-Chinese yuan pair throughout 2017. Since the news started floating a few days ago, Bitcoin's value has seen a significant slump.

It is still unsure whether the report of Caixin on the ban on bitcoin exchanges is accurate and if the Chinese government is considering imposing a temporary suspension on its local trading platforms.

The country accounts for about 23 per cent of bitcoin trades globally and is also home to numerous world's biggest bitcoin miners, who confirm transactions in the digital currency. "Old users will definitely still trade, but the entry threshold for new users is now very high".

While Beijing's motivation for the exchange ban is unclear, it comes amid a clampdown on financial risk in the run-up to a key Communist Party leadership reshuffle next month.

Over the past year Bitcoin has soared in value, largely due to its popularity in China, one of the world hubs of Bitcoin mining and trading. However, Edith Yeung's China Internet Report 2017 revealed that China is working on its own cryptocurrency so it is possible that the country is giving external cryptocurrencies the same treatment it gave to Facebook, Google, and Uber.

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More to that, within a single day, bitcoin price in the Chinese exchange market rose by 9.3 percent, while other markets such as the US, Japan and South Korea remained stagnant. Buying Bitcoin was a way to bypass those rules.

With CEX-IO, you can buy and sell Bitcoins for Dollars or Euro with payment cards or via bank transfers easily.

Still, the ban is not exactly a ban on trading Bitcoin entirely.

Other reports by Ligue1talk

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