China Orders Bitcoin Exchanges In Capital City To Close (bbc.com)

An anonymous reader quotes a report from BBC: China is moving forward with plans to shut down Bitcoin exchanges in the country, starting with trading platforms in key cities. All Bitcoin exchanges in Beijing and Shanghai have been ordered to submit plans for winding down their operations by 20 September. The move follows the Chinese central bank's decision to ban initial coin offerings in early September. Top exchange BTCC said it would stop trading at the end of the month. Chinese authorities decided to ban digital currencies as part of a plan for reducing the country's financial risks. All exchanges are required to send regulators a detailed "risk-free" plan of how they intend to exit the market before 18:30 local time on Wednesday 20 September. The regulator also ordered the exchanges to submit DVDs containing all user trading and holding data to the local authorities. Shareholders, controllers, executives, and core financial and technical staff of exchanges are also required to remain in Beijing during the shutdown and to co-operate fully with authorities.

Comments

"But, but, but..."

[goose-incarnated]

"It's different this time!"

*pop*

oh

Re:"But, but, but..."

[Anonymous Coward]

Proof? 6 of the top 20 richest people in the world are all members of the official "Party" in a country that still claims to be communist? Maybe they don't to deal with the hassle and expense to re-brand their country and relegate any thing referencing to communism to a museum.

If you want your widgets to be manufactured using slave labor in China you are required to hand over and IP associated with your widget. If you want access to the Chinese market to sell your widgets you will also be handing over all the IP associated with widget in question. And the corporate tax rate in China is 40% which will be applied on any revenue you generate within China. China has damn near eliminated all the trouble and expense of R&D by waiting for others to do all the heavy lifting before stealing the end results. It's a sound strategy so kudos to them for going down the road less traveled.

The top 9 officials of the "Party" have not only enriched themselves they have practically made their positions hereditary. The US may have a 1% group but China's is more like 0.0001%.

Re:interesting

[gravewax]

I would not bet on its demise nor would I bet on it holding its value. The impact of the chinese shutdown is yet to be felt, it will depend heavily on how much dodgy money was being funnelled through bitcoin as a way to hide money leaving china, that impact won't be known for a while yet, nor will the impact of exchanges handing over all the details of buyers and sellers.

Re:So much for free market reforms

[youngone]

Corrupt Chinese businessmen already have a great money laundering scheme for getting money out of the country.
Have a look at property prices in Australia and New Zealand, (there are probably other places too).
Added bonus (in NZ anyway), no capital gains tax.
Another added bonus, make friends with the right people, and you can be a citizen.
Nothing suspicious about that though, oh no.

Bitcoin Miner

[wolfheart111]

Submit a bitcoin miner on dvd to the local authorities... :P

Re: So much for free market reforms

[CGordy]

Source?

Here is a pro property bubble website claiming that Chinese investment into Australia is about 31 billion per year.

An additional 31 billion into a finite resource increases prices across the board. What is your logic for claiming it has no effect?

My source.

Re:interesting

[rtb61]

This is way, way more than a shut down of bitcoin by the government of China, this is a mass fishing expedition for crimes facilitated by the use of bitcoin. The government of China look set to be making use of bitcoin as a flag for criminal activity and doing major crime data mining to pursue those who have used bitcoin in China to facilitate crime. Depending upon how well they do, will drive how soon other countries follow suit. Way more dangerous than a simply shut down.

Re:So much for free market reforms

[ShanghaiBill]

Invest $1 million in a new business (or $500K if it is in "targetted employment area") and you get an EB-5 visa.

This is smart policy. We send money to China in exchange for containers full of Walmart merchandise, and then the money flows back into America as investments by Chinese who then become American residents. Win win.

Re:interesting

[Kiuas]

The big "dump" took place after the first announcement in China. At this point however the currency is maintaining its stable value. I don't see any major changes in the near future outside of the value increasing.

That's because you obviously have not done too much thinking on how money laundering via bitcoin in China works. The best way of getting caught red-handed as someone trying to move money out of country with BC would have been to immediately start cashing out everything you have. That would've caused a large dent in the value of BC and it'd have also meant that it's more likely for your operation to be spotted (don't be naive and think the Chinese are only monitoring exchanges inside their borders).

The Chinese own a significant portion of all BC currently in circulation. This means if they all decide to cash out and stop using BC the price can come down a lot, but it won't happen overnight because that'd just be a bad move for the investors that want their money out. If the chinese government cannot be persuaded into reversing their policies, it's likely that the Chinese BC investors will start slowly liquidating their BC over the next year(s) which would have a notable impact on the demand of BC globally, thereby affecting its value negatively.

The fact that no immediate crash was seen after the announcement is not proof that the value will remain stable.