Chinese Bitcoin Exchange BTC China Stops Yuan Deposits from China Merchants Bank

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Chinese Bitcoin Exchange BTC China Stops Yuan Deposits from China Merchants BankBTC China, one of the China’s leading bitcoin exchanges has stopped accepting yuan deposits from China Merchants Bank Co. as the country continues to ding bitcoin.

Shanghai-based BTC China, which was briefly the world’s largest bitcoin exchange last year, was told by the bank to close all the accounts with it. It announced the move on its official page on microblogging site Sina Weibo.

China Merchants Bank announced last week that it will no longer facilitate bitcoin transactions, making it the first among Chinese banks to do so. It justified its move by saying it was meant to “protect public interests, safeguard the legal status of the yuan to prevent money laundering” in a statement published on its website on April 25.

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While the People’s Bank of China banned financial intermediaries in the country from handling bitcoin transactions, it is only recently that its weight has started being felt after it issued a discreet order to the banks to shut down bitcoin-related accounts. This has seen bitcoin exchanges such as BTC China stop accepting deposits in yuan.

Two Chinese bitcoin exchanges, Shanghai-based FX BTC and Shenzhen-based BTC 38, stopped accepting yuan deposits from clients earlier in April. However, BTC China was reluctant to follow suit, arguing it was yet to receive any circulars touching on the issue from its banks.

BTC China still accepts bitcoin deposits and customer deposits in yuan from other financial institutions, its spokesman Kenneth Ling told Wall Street Journal. The price of bitcoin plunged 15 percent on Monday following the news. 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 deepak@forexminute.com