Bitcoin trading platform awaits confirmation from the central bank that withdrawals will resume after restart

Image source: Oriental IC

Source: Interface

Huobi, Bihang, and BTCChina, the three major trading platforms, have suspended Bitcoin withdrawals for more than a month, and the regulatory authorities are gradually regulating Bitcoin. The central bank recently issued a document called "Related Guidelines" to large Bitcoin trading platforms in Beijing and Shanghai for internal discussion.

People familiar with the matter revealed to Interface News reporters that these include the need for Bitcoin exchanges to confirm customer identities and comply with banking industry anti-money laundering regulations.

It is reported that the contents of the "Guidelines" received by multiple platforms are basically similar. The Beijing Bitcoin Trading Platform received the document a week ago, while the Shanghai platform just received it this week.

It is understood that the "Guidelines" require trading platforms to collect customer information, and the Bitcoin trading environment is being tightened.

A Huobi user told the reporter that when he logged into the website to withdraw RMB a few days ago, Huobi prompted him to upload photos of the front and back of his ID card, and the ID card could not be blurred or obscured at all.

In response to this, a senior executive of Huobi.com said that according to regulatory requirements, once a user engages in RMB transactions, they must complete C2 (secondary RMB certification): "C2 certification will be triggered when the user clicks to withdraw RMB. Previously, the platform's certification level for ordinary users was C1, which means entering the ID number; of course, for some accounts whose transactions trigger AML (anti-money laundering) risk warning scores, the platform uses C3 certification, which means starting the video and answering questions."

On February 9, BTCChina, Huobi.com, and BiXing announced that in order to further curb speculation in the Bitcoin market and prevent the possibility of illegal pyramid schemes, money laundering, and foreign exchange through Bitcoin, they will suspend Bitcoin and Litecoin withdrawals from today. This may be because the central bank publicly stated that month that Bitcoin trading platforms that violate anti-money laundering and foreign exchange management regulations will be closed.

After developing and upgrading the anti-money laundering system, can Bitcoin withdrawals be restarted? A senior executive of a platform said that the anti-money laundering system has been developed and is ready to go online after the regulatory approval; another platform said that it is still being modified in accordance with regulatory requirements.

The executives of the above-mentioned platforms revealed that the regulatory authorities are very aware of the development progress of each platform, but the central bank may be waiting for the right time to accept and approve it. At the same time, the "Guidelines" have not yet been finalized and are only regulatory documents. The official may make further revisions. The platform is continuing to cooperate with the central bank and welcomes a balanced, risk-based regulatory framework.

The restrictions on Bitcoin withdrawals brought about by the tightening of the Bitcoin trading environment have indeed affected the trading methods in the past month. Previously, users of the above-mentioned Bitcoin platforms could withdraw Bitcoin on domestic platforms, and then use Bitcoin wallets to link Bitcoin to overseas trading platforms denominated in US dollars and other currencies to earn foreign currencies or price differences between platforms.

However, during the period of restricted withdrawals, the price and 24-hour trading volume of the three major domestic Bitcoin platforms were lower than those of foreign platforms. As of press time, the price of BTC-E was $1,142, or RMB 7,882, and the price of Bitcoin China was $1,112, or RMB 7,660.

Another example is that on March 10, based on the market's recent expectations that the U.S. Securities and Exchange Commission (SEC) may approve the first Bitcoin ETF, the price of Bitcoin soared 10%, setting a new record of $1,325. At the time, Huobi.com quoted 8,030 yuan, or about $1,163.