One of China’s leading Bitcoin exchanges has announced the imminent suspension of operations in the wake of a crackdown on initial coin offerings launched by the central bank, as well as a wave of ICO platform closures.
On 14 September BTC China announced that it would immediately suspend the registration of all new users, as well as cease all trading operations by the end of the month.
According to BTC the decision to suspend new user registration and trading operations is prompted by the “Public Notice Concerning the Prevention of Cryptocurrency Issuance Financial Risk” (关于防范代币发行融资风险的公告) issued by the Chinese central bank on 4 September, and its mandate for the “prevention of investment risk and the protection of user interests to the greatest extent.”
The announcement makes BTC the first Bitcoin exchange in China to announce the suspension of trading operations.
BTC said that mining pool operations and other business would be unaffected by the suspension of new accounts and trading, and would continue to operate as normal.
BTC China is one of the three main Chinese Bitcoin exchanges alongside OKCoin and Huobi.com, who collectively account 60% of virtual currency transactions within the industry.
The Chinese government is cracking down on the use of virtual currencies domestically, leading to a sharp decline in transaction volumes.
While China accounted for 90% of global Bitcoin transactions in 2013, this figure has since dropped to roughly 30%.
Sources from China’s Internet financial risk rectification work team previously told Caixin that regulators has decided to shut down domestic virtual currency exchanges, focusing on platforms such as BTC China, Huobi and OKCoin that permitted the conversion of cryptocurrencies into fiat money.
The public notice issued by the Chinese central bank on 4 September also stipulates that “so-called cryptocurrency financing and transaction platforms” are prohibited from engaging in transactions involving virtual currency, the conversion of virtual currencies into fiat money, and the provision of services including pricing and information intermediation in relation to virtual currencies.