Bitcoin Tumbles on Rumors of PBOC’s Order for Accounts Shutdown

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Bitcoin Tumbles on Rumors of PBOC’s Order for Accounts ShutdownBitcoin prices plummeted nearly 10 percent on Thursday as news filtered in that China’s central bank had issued a directive to the local banks to stop dealing with businesses that transact using the virtual currency.

The Bitcoin was trading at $535.10, a drop of 7.77 percent from the Wednesday’s closing amount, according to CoinDesk.  This was triggered by media reports that the People’s Bank of China had mailed banks directing them to shut down the accounts of 15 Bitcoin traders by April 15. The digital currency hit an intraday low of $514.24 today.

“I’m aware of the rumors circulating on the topic,” Bobby Lee, chief executive of BTC China, a leading bitcoin exchange in China, told Bloomberg. “I haven’t heard of anything else to confirm that. We are still waiting to see what happens.”

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BTC China was quoting the Bitcoin at 3,053.98 yuan, down 14.1 percent, reported Wall Street Journal. Yuan is the second most traded currency against the Bitcoin in terms of volumes after the dollar.

While the PBOC circular couldn’t be confirmed independently, some reputable Chinese media such as online business news site Caixin verified the story as a fact.

When asked whether customers will no longer be able to send funds to BTC China from their bank accounts directly, Lee cautiously agreed. However, he said one option for customers would be to make direct deposits with cash.

“If the rumor turns out to be true, that’s what’s going to happen. At this time it’s too early for me to elaborate on what steps we will take,” said Mr. Lee. “We will take it one day at time.”

Under PBOC rules, the directive may never be disclosed publicly, though banks will enforce it.

To contact the reporter of this story; Deepak Tiwari at deepak@forexminute.com