OKCoin and Huobi have decided to prolong the period of bitcoin withdrawal freeze following the announced halt of cryptocurrency trading operations.
The original suspension period of 30 days is now extended for an indefinite term. The exchanges are negotiating relevant policy standards with the authorities. Chinese crypto exchanges have been shutting down their activities following demands of the country’s financial regulator. The People’s Bank of China urges trading platforms to counteract money laundering and comply with national legislation, reads the OKCoin’s statement (in Chinese).
“We are trying to make the bitcoin industry healthier, thank you for your understanding and support,” claims the statement.
Huobi, in turn, promises to announce the date of resumption of trading activity as soon as it is approved by the regulator.
The statement comes shortly after the People’s Bank’s representative confirmed that the regulator will carry on monitoring the activities of domestic crypto exchanges.
Zhou Xuedong, director of the central bank’s Business Administration department, emphasised the necessity to create a long-term regulatory mechanism to control cryptocurrency trading platforms, the Chinese news agency Sina reports.
“There are significant risks: first, the risk to the safety of customer funds, second, the risk of money laundering, third, the risk of leveraged transactions,” Xuedong said.
On 7 January 2017, the People's Bank of China announced it would carry out inspections at major bitcoin exchanges looking for a possible breach of current financial regulations. The news resulted in a collapse of bitcoin price, which lost 20% in one day. A few days later, BTCC and Huobi stopped margin trading, followed by OKCoin and other Chinese exchanges. In February, the Chinese trading platforms for the first time froze bitcoin withdrawals.