China strengthens Bitcoin regulation and has suspended withdrawals for two months. It is still unknown when withdrawals will resume.

Golden Finance News: Since 2017, Bitcoin traders around the world have been paying attention to the changes in the Chinese Bitcoin market. This is because the People's Bank of China has been strengthening Bitcoin supervision since the beginning of this year, and has been continuously improving the corresponding regulatory measures until now.

Since 2017, the People's Bank of China has strengthened Bitcoin supervision. Image source: Golden Finance

In the past two months, due to the strengthening of Bitcoin supervision, almost all Bitcoin exchanges in China have suspended Bitcoin withdrawal services. Major large Bitcoin exchanges (such as BTC China, Huobi, OKCoin, etc.) have issued announcements early in response to the anti-money laundering supervision actions of the People's Bank of China and stopped Bitcoin withdrawal services on February 9.

At that time, major domestic Bitcoin exchanges announced in their announcements that the deadline for suspending Bitcoin withdrawal services would be about one month later, around March 8. However, things did not go so smoothly. On March 8, the major Bitcoin exchanges that had issued announcements once again announced in their announcements that they would postpone the resumption of Bitcoin withdrawal services, and measures to strengthen Bitcoin supervision were still in progress.

China's central bank has a clear stance on strengthening Bitcoin regulation Image source: Golden Finance

Since the Chinese central bank has a clear position on strengthening Bitcoin regulation, major Bitcoin exchanges are actively cooperating with the central bank's rectification actions. As a result, China's Bitcoin trading market has undergone a huge change in 2017 - China handed over the title of "the world's largest Bitcoin trading market" to Japan. Japan also took this opportunity to rapidly develop its domestic Bitcoin industry.

The People's Bank of China continues to implement anti-money laundering regulatory measures, which has now caused domestic Bitcoin exchanges to be unable to withdraw money for more than two months, but it has been effective in formulating stricter Bitcoin supervision. For example, major Bitcoin exchanges have successively launched new KYC (know your customer) processes, including on-site verification and remote video recognition.

According to the Bitcoin exchange OKCoin, the platform is upgrading to a multi-signature withdrawal system, but did not elaborate on when the platform will be able to resume withdrawal services. It is reported that after April 23, users of the platform will be able to use multi-signature controlled Bitcoin wallets to store Bitcoin and Litecoin.

Huobi and BTCChina, two other top Chinese bitcoin exchanges, recently told the public that all Chinese bitcoin exchanges are continuing to push for measures to strengthen bitcoin regulation and that withdrawals will resume after the entire system is upgraded. Huobi explained in a recent announcement:

“Once approved by the regulatory authorities, the withdrawal service can be resumed. Please pay attention to the official announcement of Huobi for the specific time.”

A recent report also detailed that young Chinese Bitcoin traders have been profiting from Bitcoin trading. They believe that strengthening Bitcoin regulation will further optimize the domestic Bitcoin environment, and expect China's cryptocurrency market to continue to prosper.

However, the report also revealed some phenomena in response to the strengthening of domestic Bitcoin regulatory measures, with a large number of Chinese Bitcoin traders pouring into OTC (over-the-counter) and P2P platforms such as Localbitcoins. It is reported that the P2P Bitcoin trading platform Localbitcoin is constantly refreshing the RMB transaction volume on the platform.

After strengthening Bitcoin regulation, RMB transaction volume on P2P websites has increased significantly. Image source: Golden Finance

Foreign media said that currently OTC markets and Localbitcoins transactions are the only options for large Chinese bitcoin traders. The whole world is speculating when China will be able to complete the work of strengthening bitcoin regulation so as to resume bitcoin withdrawal business as soon as possible.