Earlier this month, major Chinese finance media company Caixin revealed that the People’s Bank of China’s newly drafted regulations on bitcoin trading and local digital currency exchanges are set to be implemented by June.
Until then, on-site inspections on the country’s three largest bitcoin exchanges OKCoin, BTCChina, and Huobi will likely continue. Caixin also reported that the inspections are close to completion and that the three exchanges will have to face administrative punishment before the new regulations are implemented. The local publication noted that Chinese exchanges will have to pay fines for their previous operations that may have violated existing financial regulations in China.
Although the Chinese bitcoin exchange market has made a strong comeback in the past few weeks after reclaiming its title as the second largest bitcoin exchange market behind the US with a 15 percent market share over the global bitcoin exchange market, Chinese traders are still unable to withdraw their funds.
Interestingly, over the last two weeks, an increasing number of investors have started to purchase bitcoin on local bitcoin exchanges despite the temporary withdrawal suspension imposed on all three major Chinese bitcoin exchanges.
More to that, Chinese bitcoin exchanges have begun to request an excessive amount of personal and financial information from bitcoin traders who are simply purchasing the digital currency through regulated trading platforms. Local sources including CNLedger revealed that exchanges including Huobi started to demand face-to-face interviews, submission of bank documents, proof of funds, proof of identity and other documents.