China made a move that had an adverse impact on the value of the Bitcoin. The authorities ordered the bitcoin exchanges in Shanghai and Beijing to submit plans on how they would close down their operation by 20th September. A top bitcoin exchange in the country stated that it would end their activities by the end of September. Also, the regulators required that the exchanges submit softcopy data about their trading and holding.
The authorities require the stakeholders of the exchanges to remain in Beijing during and after the closure. It requires them to cooperate with the regulators fully. Most analysts do not believe it will be the end for bitcoin in the country. It is because some other countries took the same path only to come up with new regulations for the currency. An example is Japan and Australia.
The moves come after the Central Bank of China approved the decision to ban the initial offerings of bitcoins at the start of September. It is because of the financial risks that the country is facing. The bank figured out that banning cryptocurrency would reduce the financial risks that it faced. It is because the currency is not highly regulated compared to the formal currencies that most countries use. Also, it is peer to peer, and this makes it very volatile. Some people criticized the move. However, others backed it. Some other countries are also making some moves on the cryptocurrencies.
The bank moved a step further to set up a website that provided information on the drawbacks of the cryptocurrency. It indicated that criminals used the currency to commit crimes. The crimes included illegal fundraisers, trafficking, smuggling, and money laundering.
Weibo users were able to access a leaked documentYour text to link… concerning the suspension of the usage of bitcoins in the country. The report showed that the Chinese regulators wanted all the exchanges to stop the registration of new users by the midnight of 15th September. It also required that they inform the users publicly when they end the operations.
The move spells doom for investors in cryptocurrencies. The only option that these investors have is moving out of the country and setting up exchanges in other regions. If they can do this earlier, they can maintain a good chunk of the client pool that they have. However, its only time that can tell.