“It’s a sad day for the Bitcoin community here in China,” said Wei-Tek Tsai, the director of the Digital Society and Blockchain Laboratory at Beijing’s Beihang University.
In a statement published on the messaging platform WeChat, BTC China said it would “stop all trading on September 30.” It said the move was in response to a decision this month by Chinese regulators to ban so-called initial coin offerings, in which new digital currencies seek to raise funds.
The price of Bitcoin dropped more than 10 percent on Thursday, to around $3,500, in the hours after the announcement.
Bitcoin is increasingly in the spotlight around the world. Its proponents — a group that includes tech enthusiasts, civil libertarians, hackers and criminals — cheer the fact that it can be sent across borders anonymously and that it is not regulated by a central authority like a typical currency.
China has emerged as the leading force in Bitcoin trading in recent years. But as the virtual currency’s profile has risen in the country, Chinese regulators have increasingly sought to control how it is traded and used. When they stepped up their oversight of Bitcoin trading this year, it led to a rapid and substantial drop in trading volumes.
“Because it is traded anonymously and peer to peer, Bitcoin makes it easy for money laundering and tax evasion,” said Sheng Songcheng, an adviser to the People’s Bank of China, the country’s central bank.
Official Chinese news media has cited officials as saying they want to close Bitcoin exchanges — a move that precipitated Thursday’s decision by BTC China — though they have not set a time frame.
China Business Network, a financial and business news portal, said on Thursday that the authorities in Shanghai, where BTC China is registered, would close all Bitcoin exchanges within their jurisdiction by the end of the month; and the report piled on further uncertainty.
Though the moves by the Chinese authorities this month have resulted in declines in the value of Bitcoin, some argue that they will allow for a more even geographic distribution in the online currency’s trading and mining.
“The overall share of Chinese exchanges has been diminishing steadily,” said Thomas Glucksmann, marketing manager for the Hong Kong-based Bitcoin exchange Gatecoin. Mr. Glucksmann said that much of the Bitcoin community had been concerned about the increased level of scrutiny in China and had been moving their assets out of the country.
“People will realize that China is out of the picture for the moment,” he said.
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