Bitcoin exchanges in China await clarification of shutdown talk

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China seems pretty determined to keep Bitcoin from gaining any more traction.

However, cryptocurrencies are not banned in China, only trades and ICOs.

In the past, the Chinese government has banned Bitcoin transactions at banks and retailers, and more recently it banned ICOs, Initial Coin Offerings.

Chinese authorities have reportedly chose to ban the trading of Bitcoin and other cryptocurrencies on domestic exchanges, the Wall Street Journal reports.

If the Chinese government ultimately decides to handle the issue privately with its local trading platforms by cooperating with bitcoin exchange as it has done since November of 2016, bitcoin price will likely be able to recover beyond the $4,500 mark towards new all-time highs, given the successful short-term scaling of the bitcoin network through SegWit.

Notably, Bobby Lee, CEO of China's oldest bitcoin exchange, BTCC, posted a poll on Twitter suggesting that he is not entirely convinced by the news.

Bitcoin exchanges in China await clarification of shutdown talk
Bitcoin exchanges in China await clarification of shutdown talk

"Trading volume would definitely shrink", said Zhou Shuoji, Beijing-based founding partner at FBG Capital, which invests in cryptocurrencies.

At one point, exchanges in the country accounted for more than 90 per cent of the world's bitcoin transactions. The nation is taking aggressive action to regulate Bitcoin and protect itself from a potential cryptocurrency bubble.

The clampdown is seen as part of China's efforts to regain greater control over its own currency, the yuan, after the surge in bitcoin's price past year was attributed to eager Chinese buyers looking to sell yuan, fearing its collapse. As regulations tightened, China's share has slid to less than 30%.

According to the The Wall Street Journal, bitcoin exchanges are now being clamped down on, with no trading to be done within Chinese borders.

OKCoin, BTC China and Huobi, the country's three biggest bitcoin exchanges, said on Monday that they hadn't received any regulatory notices concerning bans on cryptocurrency trading.

"Whenever you start to hear about Hong Kong taxi drivers becoming millionaires from buying bitcoin, you start to think this is not necessarily driven by fundamentals", he said.

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