Focus Interview Interpretation: Bitcoin's important regulatory shoe has landed, and exchanges are no longer at risk of being closed or suspended from deposits

The Focus Interview on February 14, 2017 is an important statement by the Chinese government on Bitcoin regulation, and it is worth a careful review by everyone in the cryptocurrency circle.
http://tv.cctv.com/live/cctv1/, starts at 7:39pm

1. Objective and neutral introduction to Bitcoin

The government’s attitude towards Bitcoin can be seen from whether the introduction of Bitcoin is objective and neutral.

Host : It has only been 8 years since the concept of Bitcoin was proposed, but its price has skyrocketed 1 million times , and now the vast majority of transactions are conducted on Chinese platforms.

Since Bitcoin can be purchased with cash and exchanged for cash, many overseas e-commerce websites have begun to accept Bitcoin payments . Therefore, domestic telecommunications network fraud gangs have also set their sights on this trading platform and used the Bitcoin trading platform as a money laundering channel.

2. Acknowledge that Bitcoin cannot be shut down and regulate it under this premise

Li Lihui (former president of the Bank of China and member of the Financial and Economic Committee of the National People’s Congress) revealed the government’s important views:

You want to destroy this Bitcoin, which is impossible

Since we admit that Bitcoin cannot be destroyed, it is impossible to destroy or cripple exchanges, causing transactions to become completely uncontrollable off-site, not to mention actions such as cracking down on mining farms.

3. Anti-money laundering loopholes caused by agent recharge

In the 415 notice of 2014, the central bank once suspended the exchange's recharge bank account, and the exchange was forced to use recharge agents. If users want to recharge, they must first transfer the funds to the recharge agent, and the agent will then transfer the funds to the exchange. Of course, the anti-money laundering capabilities and responsibilities of the recharge agent cannot be compared with those of the exchange .

Host : When the suspect used the Bitcoin platform to launder money, he first used "Jiang Wei's" card to transfer money to the Bitcoin trading platform.
When the Bitcoin trading platform conducted the so-called customer identification, the suspect provided a copy of the ID card of a person named "Lin Shunhao"

I heard that this was a serious anti-money laundering violation, but then I read on.

It is caused by the recharge agent.

Regulatory authorities : How dare you recharge if the money in the account is inconsistent?
Exchange : Since you don’t shut me down and don’t allow me to use my bank account to receive recharges, I can only go through the recharge agent, and it is his responsibility.
Regulatory authorities : How dare you collect money without KYC?
Recharge agent : I did KYC. He wanted to recharge, so I recorded his ID card. But I am alone, so I can only see whether the money has come in, but I can't see who transferred it .
Regulatory authorities :

Why did the central bank frequently use big moves in its supervision of exchanges in 2017, such as interviews, inspection teams stationed in, and suspension of withdrawals for one month, but never used the powerful suspension of bank account top-ups in 2014? This is the reason. It can be expected that if exchanges can fulfill their anti-money laundering responsibilities, the central bank will no longer use the big move of suspension of top-ups , and the biggest blow of this round of supervision has landed here.

3. Put Bitcoin and Bitcoin exchanges, which have financial attributes, into the cage of law and regulation

It is clear that the regulatory authorities have changed their attitude towards Bitcoin:

1. 2013: Five ministries and commissions issued a notice not to recognize Bitcoin as a currency and prohibit financial institutions from providing services to exchanges.
Zhou Xiaochuan, the governor of the central bank, said at the Boao Forum for Asia that Bitcoin is not a currency approved by the central bank, and there is no question of banning it. It is a collectible like stamps.
This is actually an ostrich strategy. I exclude you from the financial scope and don't want to care about you. I let you fend for yourself.

The practice of pushing it aside in 2013 and banning it in 2014 has led to chaos in the industry and rampant money laundering using Bitcoin.

2. 2017: Recognize that Bitcoin and Bitcoin exchanges have financial attributes and should be actively regulated.

Now there is only one shoe left to drop: How will anti-money laundering supervision be carried out when withdrawing money?
● It is a disguised ban (the possibility is small and it is very unfavorable to Bitcoin).
● Or is it like the foreign Coinbase exchange, where different certification levels limit different withdrawal amounts, and if a gambling/black market/money laundering mixer address is mentioned, withdrawals will be prohibited next time?

At the end of the show, the host concluded:

Put Bitcoin into the cage of laws and systems.
Only then can it become a part of the normal operation of this society for a long time.

Like the internet? :)

Welcome to follow my Weibo to get the most timely and in-depth analysis:
http://weibo.com/ltc1btc

Expansion & Bull Market Series:

January 22, 2016: [Bitcoin faces a critical choice] We urge all holders to support the 2MB expansion.]
March 11, 2016: [Basic Science] Can Bitcoin support all human transactions?
June 26, 2016: "4,000 yuan is the beginning of the Bitcoin bull market"
October 15, 2016: [Completely end the debate between hard and soft forks] Safe hard forks are soft fork expansions [English Ver]
October 20, 2016: "On the Correct Approach to Bitcoin Upgrading (and Refuting ahr999's "Consensus Rules")"
October 29, 2016: "Pouring cold water on Zcash - With Deep Black, does the market really need Pure Black?"
November 4, 2016: "Beware of Exchange Risks Under Tightened Foreign Exchange Regulation"
November 22, 2016: "Why do we firmly oppose Core's soft fork Segregated Witness? Jiang Zhuoer, who has invested tens of millions of real money in mining, tells you the answer!" [English Ver]
December 22, 2016: Weibo: "Update of the bubble index and other data in "Also on 4,000 yuan is the beginning of the Bitcoin bull market""
December 31, 2016: Weibo post: "Telling you something that is extremely scary when you think about it carefully"
January 4, 2017: Weibo: "This may be the last time that the bubble bull market can soar 10 times"
January 11, 2017: Weibo: "The central bank has finally completed the task of deflating the bubble. This round of bull market has a habit of correcting 40% after each new high."
January 13, 2017: [Basic Science] How to use a mobile wallet to safely store Bitcoin (and talk about the recent situation)
January 13, 2017: "Happy to hear that BTCC and Huobi have stopped margin trading, OK has reduced leverage to 1x, and all fake coins in the market have been wiped out"
February 5, 2017: [Bitcoin Economics] Discussing the long-term impact of financing, currency lending and handling fees on currency prices
February 10, 2017: "On the central bank's dilemma regarding Bitcoin"
February 13, 2017: "The market over-interpreted Haobtc's closure of RMB recharge"