People’s Bank of China announced today that it will continue to carry out spot investigations at the country’s leading bitcoin trading venues, in a statement on its Beijing head office website. This comes as volumes at Chinese exchanges are dropping considerably to levels more akin to those of the rest of the world.
Two weeks ago the central bank revealed that the authorities have formed a joint inspection team to carry out on-site inspections at Bitcoin exchanges, focusing on checking whether there is any market manipulation, sufficient anti-money laundering (AML) system implementation, financial security risks and so on.
Following that revelation, BTCC, Huobi and OKCoin first stopped offering leveraged trading on margin and then imposed a 0.2% transaction fee, drastically changing the way bitcoin trading was done in China.
Charles Hayter, the CEO of CryptoCompare.com, explains how the Chinese market is developing: “The market share has dropped from over 98% to just 29% after moves by the PBOC to limit trading on margin and marketing activities in the past two weeks.
This is an attempt to temper the bitcoin industry’s exuberance at the end of last year. The Chinese bitcoin companies are bowing prostrate to the authorities hoping that by treading the line they won’t face any more severe restrictions or punitive measures to their businesses.”