Bitcoin Gets QQ Coined in China: PBOC and Regulatory Commissions Statement Highlights

On the PBOC’s website in Chinese, the PBOC, China Banking Regulatory Commission (CBRC), China Securities Regulatory Commission (CSRC), and China Insurance Regulatory Commission (CIRC) have together issued in a joint statement the following highlights of what it forbids:

1.  《通知》要求,现阶段,各金融机构和支付机构不得以比特币为产品或服务定价,不得买卖

Translation: Notice: Requiring at the present stage, every financial institution and payment institution cannot set prices in Bitcoin, nor execute transactions.

2.  不能以比特币作为支付结算工具

Translation: Bitcoin cannot be used as a payment tool to settle accounts.

Note that at this line, the PBOC refers to all business in China.

3 . 不能用比特币与人民币及外币的兑换服务

Translation: Cannot use Bitcoin for foreign [and domestic] currency exchange.

4.  不能用 比特币作为信托、基金等投资的投资标的等。

Translation: Bitcoin cannot be used in trust funds, other investment funds.

5.  不能 发行与比特币相关的金融产品

Translation: Cannot issue financial products and services in Bitcoin.

Under these regulations, the People’s Bank of China has already set the stage to render prices listed in Bitcoin as illegal, as not only setting prices in Bitcoin are not okay anymore, but also using Bitcoin as a payment method to settle consumer and business accounts is also no longer okay according to the PBOC and the CBRC, CSRC, and CIRC.

China, while not outlawing Bitcoin outright, has essentially through this move classified Bitcoin similar to the “fictitious currency”, QQ Coins, which saw itself suddenly leashed in 2009 and relegated to no more as a fictional, theoretical currency. While Bitcoin is not being treated quite in this way, still allowing Bitcoin to be used as an investment vehicle, the supporting factors behind Bitcoin adoption in China, namely e-commerce, has largely been shot in the foot by the PBOC and associated regulators. Indeed, Bitcoin is being treated very similarly to how China’s Ministry of Culture  and Ministry of Commerce cracked down on the QQ Coins currency in 2009:

“”The virtual currency, which is converted into real money at a certain exchange rate, will only be allowed to trade in virtual goods and services provided by its issuer, not real goods and services.” it said.”… “According to media reports, the virtual money trade topped several billion yuan last year after rising around 20 percent annually.

Since 2007, virtual money trading has drawn official attention, with the government demanding tighter controls as such trading became an avenue for gambling and illicit trade.

Under the new rules, using virtual money for gambling will be punished by public security authorities, and minors may not buy virtual money.

The Ministry of Culture also vowed to step up supervision on money laundering via virtual credits and other illegal online activities. ”

We see very little difference in China’s regulatory stance with Bitcoin as it did with QQ Coins in 2009. The Chinese government is also not known for retracting its statements. If you are looking for the new normal of Bitcoin in China, look no farther than QQ Coin.

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