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Chinese Central Bank: Bitcoin Trading Platforms Cannot Call Themselves Exchanges

The representative of the People’s Bank of China said that cryptocurrency trading platforms, which positioned themselves as exchanges, could not be considered as such until they were given an appropriate approval of the regulator. It is reported by Bitcoin.com

In January, the PBoC’s Department started to carry out inspections of leading exchanges of the country and made a number of statements on the need to introduce rules, which would regulate their work.

The director of business management Zhou Xuedong said that there were new regulatory guidelines coming soon aimed at combating money-laundering. According to him, the Chinese government would continue to encourage blockchain innovations, but using blockchain to produce a “bubble” was something it would not support.

        ʺThere was a time that the bubble of bitcoin speculation was indeed too much,ʺ Zhou said at the press conference on Monday, March 13.

He also noted that some platforms had altered bitcoin trading volumes in order to attract more customers. Zhou said that the risks associated with bitcoin trading were significant and trading platforms must be examined and regulated.

ʺSome economists believe that bitcoin is in a bubble, one that will burst sooner or later. But technically, bitcoin uses blockchain as its underlying technology. That is a relatively successful application. Some countries have already recognized its legal status and can adopt it as payment tool for purchasing goods. That is to say, they recognize bitcoin’s value. Thus bitcoin may continue to exist,ʺ Zhou Xuedong said.

Most notable was his statement that bitcoin trading platforms should not be called “bitcoin exchanges”. According to him, these types of businesses are just “websites or trading platforms”.

ʺIf trading platform is called an exchange, it is not allowed to work unless a relevant department of our country permits it. Many people regard bitcoin online trading platforms as exchanges. These are actually two different concepts,ʺ the representative of the PBoC emphasized.

Zhou Xuedong also said that In order to become an exchange, businesses must get permission from the securities department. As for current bitcoin exchanges, they can only get this permission after the government qualify them as trading platforms for commodities.

ʺIn the long run, they must be included in the local management of commodity trading platforms, under the supervision by the local financial bureau, and implement the main regulatory guidelines and supervision. The PBoC branches, the Securities Regulatory Bureau, Insurance Regulatory Bureau, Revenue Department, the Taxing Department, and others will implement functional supervision,ʺ Zhou Xuedong added.

It should be reminded that the PBoC announced new rules to be followed by cryptocurrency exchanges of the country a few days ago.

Source: forklog.com

  • March 15, 2017 2:43 PM MSK
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