The People’s Bank of China (PBOC) renewed its efforts to regulate bitcoin exchanges this week. Zhou Xuedong, Director of the Bank’s Department of Business Management, which carried out inspections of bitcoin exchanges, outlined some new rules which exchanges must follow.
Also read: Reserve Bank of India Predicting the Future of Bitcoin
PBOC Adopting a ‘Forgiving Attitude’
Zhou, who is also a deputy to the NPC (National People’s Congress), the national §
[The regulators] shall adopt a forgiving attitude, not be prohibitive for the time being, and set an observation period.
List of Prohibited Activities
Among the numerous rules Zhou proposed was a list of prohibited activities imposed on bitcoin exchanges. According to Caixin, this list includes:
1. Offering leverage and margin trades.
2. Producing fake volume and manipulating the market using zero fees.
3. Violating AML laws.
4. Violating regulations on foreign currency management and cross-border capital transfer with bitcoin.
5. Replacing fiat by using bitcoin to purchase goods.
6. Tax Evasion.
7. Engaging in false advertising or participating in Ponzi schemes.
8. Providing financial services without a permit, including credit, securities, and futures trading.
There will be penalties and fines for any bitcoin exchanges found to be in violation of these rules, Zhou warned, adding that they can be suspended or forced to withdraw from the market. Serious violators can even be forced to shut down their businesses.
Long-Term Regulatory Plans
Caixin also reported Zhou saying that bitcoin is “a special digital asset that is difficult to be controlled” given its characteristics such as anonymity, being globally distributed and having no physical entity. He said that the PBOC will research the properties of bitcoin, explore management policies for the exchanges at the national level, and also consider licensing a number of qualified exchanges.
The NPC Deputy then proposed a “calm and rational” approach when looking at bitcoin, noting that:
If oversimplified measures such as closing them down were taken, [investors] will be led into the underground black market or OTC markets, which are more difficult to control. Therefore, it is necessary to explore the establishment of long-term regulatory mechanisms.
He was also asked by a Caixin reporter whether the inspections of bitcoin exchanges could be extended upstream to suppliers or downstream to customers. Zhou replied: “From the
Also, Zhou listed other aspects for exchanges to consider, including account identification, funding sources, capital flows, and abnormal transactions. He sees beneficial uses for blockchain technology, believing that it can be used for reference and for regulating the flow of bitcoin and fiat currency. He suggested how data from exchanges to regulators can be synchronized as the basis for regulation. “And with this data, some of the money laundering information and abnormal transactions can be identified”, Zhou told Caixin.
What do you think of the PBOC’s rules for bitcoin exchanges? Let us know in the comments section below.
Images courtesy of Shutterstock and PBOC; Translation by Bitcoin.com’s correspondents in China
Bitcoin.com is a unique online destination in the bitcoin universe. Buying bitcoin? Do it here. Want to speak your mind to other bitcoin users? Our forum is always open and censorship-free. Like to gamble? We even have a casino
The post PBOC Lists New Rules for Chinese Bitcoin Exchanges appeared first on Bitcoin News.
from Bitcoin News http://ift.tt/2mrug9k
via IFTTT
No comments:
Post a Comment