Bitcoin Slightly Down as BTC China Halts RMB Withdrawals

| Updated
by Polina Chernykh · 3 min read
Bitcoin Slightly Down as BTC China Halts RMB Withdrawals
BTC prices are trading slightly down today after BTCChina, one of the largest bitcoin exchanges, halted Yuan deposits. Photo: Siarhei Karotki/Coinspeaker

Bitcoin prices decreased as BTC China, a China’s largest bitcoin trading platform, stopped Yuan deposits.

BTC China, one of the largest bitcoin exchanges, stopped accepting PMB deposits to user accounts from China Merchants Bank. The decision was followed by a bank’s announcement that it would not allow its customers to be engaged in financial transactions involving bitcoin.

The firm posted the news on the Weibo site: “Due to a notice issued by China Merchants Bank, BTC China, out of consideration for user security and stabilization operations, decided to suspend the credit of accounts with RMB.”

“For subsequent updates, please pay attention to our website and Twitter, thank you again for your interest and support of BTC China.”

Last week several banks and financial institutions said they were going to stop any operations with bitcoin exchanges after meetings with representatives of the People’s Bank of China (PBOC). This resulted in a USD 40 bitcoin price reduction.

The PBOC criticized China Merchants bank and other institutions for providing their services to BTC China. While preventing its customers from funding their bitcoin exchange accounts, the PBOC wants to stop withdrawals from litecoin and bitcoin into yuan.

Since PBOC first revealed its concerns in last December, official policy has not changed. The bank’s representatives say:

“The current level of services that banks and third-party payment processors provide counts as directly providing services to Bitcoin related companies. Online stores and public marketplaces that sell or trade ‘deposit codes’ from Bitcoin exchanges counts as indirectly providing services to Bitcoin related companies.”

This means that payment processors and banks need to close their payment terminals and accounts at Bitcoin firms.

Some bitcoin exchangers, including OKcoin and Huobi, find a way of how to go around PBOC’s regulations. They created “deposit codes”, which users can trade with.

OKcoin presented a new “recharging method”, allowing customers to convert Chinese Yuan into codes with the same value, which can be then sold or transferred to other users. Some exchages experiment with other options such as funding via personal bank accounts and voucher systems.

Since PBOC announcement, most bitcoin exchanges closed banks accounts and third-party processors. Still, several banks continue providing services to Chinese bitcoin exchanges.

PBOC currently denies that it will ban bitcoin outright, although it did not say how it is going to restrict virtual currency use in China.

After BTC China halted Yuan deposits, bitcoin price fell to about USD 450 from USD 500. This means that the news in China raised concerns of the traders.

Bitcoin News, Blockchain News, Cryptocurrency news, News
Polina Chernykh

Polina is an undergraduate student at Belarusian State Economic University (BSEU) where she is studying at the faculty of International Business Communication for a degree specializing in Intercultural Communication. In her spare time she enjoys drawing, music and travelling.

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