Chinese

Chinese Exchanges Suspend Withdrawals for One Month

In a surprise turn of events, the two largest Chinese Bitcoin exchanges have suspended Bitcoin and Litecoin withdrawals for one month. The news follows China’s central bank inspections at nine smaller Bitcoin exchanges this week.

Also read: China to Play a ‘Leading Role’ in Bitcoin’s Future

China’s Central Bank Continues to Shake Up the Bitcoin Market

Over the past few weeks, Bitcoin spectators have been closely watching Chinese exchanges make significant changes. The People’s Bank of China (PBOC) has been inspecting the country’s Bitcoin exchanges looking for issues with regulatory compliance such as money laundering. So far the top three exchange platforms have ceased margin lending practices and have also added fees to every Bitcoin trade.

Now, this week the PBOC has visited with smaller exchanges within the region including Chbtc, Haobtc, Btctrade, Yunbi, BTC100, Dahonghuo, Jubi, Bitbay, and Yuanbao. The initial visits had caused the price to drop a touch but quickly rose back to the $1070 range on February 8. The following day on February 9 the exchanges Okcoin and Huobi announced they would suspend BTC and LTC withdrawals for one month which subsequently caused the Bitcoin price to drop 10 percent.

Market Stutters After Chinese Exchanges Suspend Withdrawals For One Month
Following the Huobi and Okcoin announcements, Bitcoin’s price drops 10% during the early hours of February 9.

Both companies have stated their exchanges will be “upgrading” in order to comply with “anti-money laundering efforts, foreign exchange management and other financial laws and regulations.” The pausing of withdrawals and the upgrades are expected to last one month but “may also be substantially ahead of the development process,” says Huobi’s announcement. This “in order to avoid possible illegal transactions that may continue before the system upgrade is complete,” Huobi’s announcement concludes.

Avoiding ‘Illegal Transactions’ Until Upgrade Completes

The third leading Chinese Bitcoin exchange BTCC which has been the most vocal exchange so far, has not made an announcement suspending withdrawals. Currently, the fiat value of Bitcoin rests at $980 per BTC, and the price has fluctuated quite a bit throughout the morning of February 9. Huobi says the suspension will stay in place to avoid any misconduct until their newly designed system is perfected.

What do you think about Okcoin and Huobi suspending BTC and LTC withdrawals in order to upgrade? Let us know in the comments below. 


Images courtesy of Shutterstock, and Zeroblock 


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  • Hennessy Hemp

    Hmm…so withdrawals reinstated 2 days prior to March 11th ETF ruling eh…nothing to see here, move along.

  • It shows again and again that it is not a good idea to keep value on bitcoin exchanges.

    Apart from that it could show that the Chinese government begins to reign in bitcoin.

    It also smells a bit of market manipulation and insider trading. Imagine you work at one of the exchanges or at the PBOC and know in advance. On OKCoin the price began to sink about 6 hours before the announcement and sank by 0.66% until the announcement. Does not sound like much, but at current volumes it means quite a lot. This is no proof, of course, but let’s say, I wouldn’t be surprised. We will never know.

  • To halt withdrawals with no probable cause of wrong doing is a crime as you have injured a party. The reasonable man would have an expectation of having access to those funds. Standard industry time is 1 day or less.