China’s central bank warns state-owned lenders, Alipay off bitcoin linked transactions in meeting
- Industrial and Commercial Bank of China, Agricultural Bank of China, China Construction Bank and the Postal Savings Bank of China among financial firms that attended a discussion organised by People’s Bank of China
- Virtual currency transactions and speculative activity have disrupted the normal order of the economy and financial system, central bank says
China’s central bank recently ordered banks, including four state-owned commercial banks, and leading mobile payments provider Alipay to cut off all transactions linked to bitcoin, stepping up its clamp down on cryptocurrencies in the country.
The Industrial and Commercial Bank of China (ICBC), Agricultural Bank of China, China Construction Bank and the Postal Savings Bank of China were among financial companies that attended a regulatory discussion organised by the People’s Bank of China (PBOC) recently. Other participants included the Fujian-based Industrial Bank, and Alipay (China), a subsidiary of Ant Group, which along with Tencent Holdings’ WeChat Pay controls more than 90 per cent of China’s mobile payments market.
“Virtual currency transactions and speculative activity have disrupted the normal order of the economy and financial [system]. They increase the risks of illegal cross-border transfers of assets and illegal activities such as money laundering,” the PBOC said in a statement posted on its website on Monday.
Chinese banks have been banned from dealing in bitcoin since late 2013, when the cryptocurrency was worth less than US$1,000 a unit, a fraction of its current value. Bitcoin rose more than 120 per cent this year to a historical peak of US$64,860 in April before dropping in value.