Bitcoin trading accounts banned in China: report

April 14, 2014 Leave a comment

Bitcoin trading accounts banned in China: report

Staff Reporter

2014-03-29

The People’s Bank of China, the nation’s central bank, has ordered banks and third-party payment companies to close all bitcoin trading accounts at more than 15 exchanges across the country, Shanghai-based China Business News reports.

The bank had recently issued a notice prohibiting domestic banks and third-party payment institutions from allowing bitcoin transactions, a source told the newspaper.

Accounts must be shut down by April 15, preventing investors in the currency from transferring funds, according to the source.

The measure was proposed during a meeting convened recently by the central bank to discuss ways to strengthen the prevention of risks involved in the peer-to-peer internet currency.

However, some industry insiders cast doubt on the feasibility of implementing such a ban.

Du Jun, co-founder of Huobi, China’s busiest bitcoin exchange, told the newspaper that if companies’ bank accounts were closed, then all records of transactions would go underground, which would make supervision more difficult.

Some industry insiders were of the view that some bitcoin exchanges had not received the notice yet.

“Our website runs normally and we have not yet received any notice,” said Xu Mingxing, founding CEO of OKCoin, a bitcoin trading website.

The restrictions on the unregulated currency were the latest from the central bank, which has sought to limit dealings that might be used to launder money or evade capital controls. The central bank had issued a notice on Dec. 5, 2013 barring financial institutions and companies from receiving payments denominated in bitcoin, or making transactions with the currency or associated products.

The ban is a result of concerns that the digital currency might pose risks to China’s capital controls and financial stability after a surge in trading in 2013 made the country the world’s biggest trader of bitcoin, according to the paper.

The latest news had sent bitcoin prices down by nearly 10% to 3,300 yuan (US$532) as of March 27.

 

Filed under Macro Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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