Following the recent ICO ban imposed in China, reports suggest that authorities are now moving to stop the exchange of digital currencies for fiat currency in the country.
On September 8, 2017, local news source Caixin last week stated (Google translated): “The supervisory authority has decided to close the exchange of virtual currency in China...”
The authorities believe that digital currencies could facilitate illegal fundraising and other types of illegal financial activities. A source told Caixin (Google translated):
“That is to say, the future in China cannot have the so-called virtual currency and Fiat trading between the platform. There is no question of whether the so-called tokens, the virtual currency and the RMB can be traded. ”
The report, says that the regulation is intended to end the exchange between cryptocurrencies and the renminbi, however, cryptocurrencies are not banned.
Notably, there has not been any official announcement of this sort from the authorities yet.
On September 9, 2017, BTCChina issued a response to the Caixin report. It said that it has not received a notice from the regulatory body and cannot confirm the authenticity of the report. It added (as translated by ZeroHedge):
“If the Caixin report is accurate, we will continue acting in strict accordance with regulators, and continue protecting the safety of customers' funds…If the report is accurate, BTCChina will stop all BTC/CNY trading, and change its business model to become an information service provider for private, one-on-one digital asset trading.”
The Caixin report sent the bitcoin price plummeting to near 4000 levels. It is currently trading at 4144 levels at the time of writing (Bitstamp).
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