BTC China halted local-currency deposits to clients’ China Merchants Bank Co (中國招商銀行) accounts, as lenders close accounts with bitcoin exchanges amid government measures to check surging trading in the virtual currency.
The suspension aims to protect security of client funds and ensure stable operations, BTC China, the nation’s largest bitcoin exchange, said on its official microblog on Saturday.
Merchants Bank banned the use of its accounts for bitcoin transactions, according to a statement dated on Friday on the lender’s Web site.
“We saw the bank’s statement and we took the initiative,” the exchange’s chief executive officer, Bobby Lee (李啟元), said by telephone yesterday.
The suspension has “basically no impact” on BTC China’s operations so far because clients can use accounts at other lenders, he said.
The People’s Bank of China (PBOC) banned financial institutions in December last year from handling bitcoin transactions, reflecting concerns about the risk posed to China’s financial stability after trading in the digital currency surged in the nation.
Introduced in 2008 by a programmer or group of programmers going under the name of Satoshi Nakamoto, bitcoin prices more than tripled in the past year, according to CoinDesk, which tracks prices across key exchanges.
CoinDesk’s Bitcoin Price Index slumped about a fifth after China’s Caixin magazine reported on March 27 that the PBOC ordered lenders and payment companies to close the trading accounts of more than 10 bitcoin exchanges. Bitcoins recently changed hands for US$453.80, according to the index.
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