Banks in China Must Identify and Eliminate Bitcoin Activities, Says PCAC

The Payments and Clearing Association of China (PCAC) advises banks to eliminate bitcoin-related activities by using prevention methods.

The Payments and Clearing Association of China (PCAC) is a national non-profit organization operating under the business guidance and oversight from the People’s Bank of China (PBOC). Photo: China Supertrends/Flickr

The Payments and Clearing Association of China (PCAC) is a national non-profit organization operating under the business guidance and oversight from the People’s Bank of China (PBOC). Photo: China Supertrends/Flickr

According to Caixin, a Chinese news agency, the government is likely to begin a new way of exchange funding methods’ examination.

The new article from Caixin features a statement from the Payments and Clearing Association of China (PCAC). Based in Beijing, PCAC serves as a self-regulatory body of the payment service industry and operates under the business guidance from the People’s Bank of China (PBOC).

The PCAC recommends to impose stricter rules on exchange funding operations. The rules enforcement will also touch third-party voucher systems that most exchanges started to use after several closures of bank accounts in May.

It is supposed that the PCAC statement was made on June 4th, but remained unnoticed outside the Chinese media.

The translated statement recommends: “Periodically use a search of account names, and comments sections in money transfers, to prevent users from using their bank accounts to deposit funds in bitcoin exchanges, so as to effect a long-term strategy towards building bitcoin risk mitigation.”

The Chinese bitcoin exchanges usually keep their voucher sellers’ account information in secret. However, it can be discovered by communicating with the sellers, using the QQ messaging service and other platforms.

Exchanges and sellers can have a number of accounts, where they usually provide personal details rather than business information.

As PCAC recommends, banks should share the customers’ information and also use blacklists and other prevention methods in order to cease such activities.

Financial institutions should provide regular reports to the PCAC on how they eliminate bitcoin risks and which methods they use to detect such activities.

Still, it is unknown whether bank in China would be able to carry out the system, taking into account the small number of bitcoin users in China.

The announcement did not influence the bitcoin cost in China. The price for the digital currency decreased from $673 to $611. At the time of the statement, bitcoin accounted for $609.

The report from Caixin was quite negative towards bitcoin. It also included tables of the exchanges and third-party distributors, categorized by name and other identifiers.

Eric Gu, a member of Chinese investors’ group BitAngelsClub, said the bitcoin environment remained positive: “We don’t at all talk about bitcoin price, but only cryptocurrency startup ideas and investment opportunities.”

The virtual money club organized a salon last week in Shanghai with more than 50 attendees. Regulatory issues were not covered. People, participating in the meeting, included individual and professional investors, such as IDG Capital.

According to Gu, BitAngelsClub will hold meetings every week from now.

Share This article

We welcome comments that advance the story directly or with relevant tangential information. We try to block comments that use offensive language, all capital letters or appear to be spam, and we review comments frequently to ensure they meet our standards. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Coinspeaker Ltd.