Regulators have ordered Chinese cryptocurrency platforms to shut down trading between virtual and traditional currencies.
Editor’s Remarks: The People’s Bank of China and regulators declared cryptocurrency “initial coin offerings” illegal last week, and now they are further tightening controls by banning the exchange of virtual currencies into RMB and other legal tenders. The country’s three largest exchanges, OKCoin, BTC China and Huobi, which together account for 60% of Chinese Bitcoin trading, have all suspended trading on their exchanges. OKCoin said it would comply with any new regulations but would continue with P2P (exchanges between different virtual currencies) trading and become a P2P platform for digital assets. Chinese regulators are suspicious of the role that unregulated cryptocurrencies have in capital flight and money laundering, and especially wary of the danger of uncontrolled bubbles forming in an economy that is awash with cash.