By
Steve Muchoki
April 23rd, 2024
BTC China, the country’s largest bitcoin trading platform, has halted deposits to accounts at China Merchants Bank, as lenders close tie-ups with bitcoin exchanges amid rising government regulations.
BTC China based in Shanghai, the bitcoin exchange with the highest trading volumes in China, has stopped local currency deposits to accounts at China Merchants Bank (CMB).
The shut down happened because of the lenders that had stopped operations with bitcoin exchanges amid rising government regulations upon the digital currency.
Moreover, this change is to ensure operations at the exchange as well as to protect security system of client funds BTC China said on its official microblog yesterday.
After its introduction in 2008 bitcoin prices trippled in the past year, recorded by Coindesk that is tracking the prices across the major exchanges around the globe.
On April 27 when the bitcoin prices fell under $450. Moreover, the lowest value of bitcoin in April equaled to $360 (April 10). According to Coindesk, the bitcoin price is $423.35 as at 6:39 am BST.
Currently China Merchants Bank holds over 500 branches in China and one in Hong Kong.The bank announced that its customers will not be able to use their bank account for bitcoin transasctions.
“We saw the bank’s statement and we took the initiative,” said Bobby Lee, BTC China’s CEO.
As for now the suspension did not have impact on operations of bitcoin exchange due to the fact that BTC China can transact funds to its users through other lenders, as reported by Mr. Lee.
At the moment BTC China is the biggest Chinese bitcoin exchange as it is having more than 75% of bitcoin transactions in yuan. According to Bitcoinaverage.com, the second and third places are taken by FXBTC and Bter exchanges, with 14% and 8% trading shares respectively.
The Chinese yuan is widely used in the industry of bitcoin, so far it is the second-most used currency in bitcoin operations after the US dollar. As a result, investors all over the world are following all the digital currency news and regulations in China.
A number of concerns from China’s central bank are raised as it worries about financial stability as the the digital currency trades are increasing. Moreover some banks announced that they would stop supporting digital currency exchanges.
BtcTrade, a Chinese exchange, announced on April 10 that an Agricultural Bank of China Ltd. in Hangzhou would shut down its account if it continued to use Bitcoin-related settlement services. In addition other exchanges such as Huobi.com and Btc100.org announced account closures.