China Warns Bitcoin Exchanges

To step up efforts to tighten regulation over digital currency, China’s central bank has told Bitcoin exchanges to refrain from margin trading and money laundering.

The People’s Bank of China (PBOC) sent out an inspection team to meet and verbally warn company officials of nine bitcoin trading platforms based in Beijing.

Specifically, the team warned the bitcoin trade operators not to participate in margin trading, money laundering, or practices violating laws on foreign exchange, taxation, and advertising.

If found violating the regulations, the exchanges will be ordered closed, according to the statement.

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Bitcoin, having no ties to the bank or government, is underpinned by blockchain technology, a digital ledger system that uses cryptography.

Because it gives users the ability to spend and transfer money anonymously, it is a convenient tool for money laundering and capital flight. –