BTC China Stops Merchants Bank Deposits
BTC China has stopped taking customers’ local currency deposits in accounts held at China Merchants Bank, as banks close bitcoin exchanges accounts in the wake of PBOC measures to curb rising virtual currency trade.
The biggest virtual currency exchange in China said on its microblog yesterday that it was suspending the accounts to secure clients’ money and maintain stability.
As Bloomberg reports, Merchants Bank stated on its website on April 25 that it had banned the use of its accounts for businesses related to bitcoin.
“We saw the bank’s statement and we took the initiative,” chief executive officer Bobby Lee said. He added the halting of the accounts did not have a substantial impact on BTC China’s business because customers can use accounts with other financial institutions.
“Due to a notice issued by China Merchants Bank, BTC China, out of consideration for user security and stabilization operations, decided to suspend the credit of accounts with RMB,” read the firm’s Weibo post as roughly translated on CoinDesk.
The People’s Bank of China prohibited banks and payment providers from supporting bitcoin transactions, highlighting concerns about the risk surging trade in the virtual currency presents to China’s financial stability.
The digital currency exchange said it would release further updates via its website and Twitter.
According to BTC China’s CEO, the firm has not been directly notified by its banking partners, but it’s willing to respond to such information should it arrive. China Merchants Bank did not mention specific virtual currency firms in its web posting.
No other financial institutions have announced how they intend to act going forward.
Last week, reports emerged suggesting that financial institutions would sever ties with bitcoin exchanges after closed-door meetings with officials from the PBOC. The price of bitcoin plummeted $40, most likely after the developments and has not yet rebounded.
To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
To contact the reporter of this story; Deepak Tiwari at firstname.lastname@example.org