Bitcoin update: Trading Chinese renminbi just got harder 1

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rmbtb.com logo

JISHOU, HUNAN — Bitcoin’s value against the dollar has dropped dramatically these last few days, bouncing between US$600 and $700. Meanwhile, China’s restriction on bank trading has cut off one of my channels to convert renminbi into bitcoins.

I found this message from rmbtb.com today.

Dear users,

Due to recent requirements by the People’s Bank of China, AliPay can no longer be used as a deposit or withdrawal method.

Users with existing CNY balances at the time of this announcement will be allowed to withdraw CNY using AliPay prior to 21 December 2013, when the AliPay function will be completely removed. Other users have had their AliPay withdrawal limit reduced to zero.

We have also tightened the withdrawal limits on Tenpay to 3,000 CNY. Please bear this in mind when selling BTC.

We are searcing for reliable new payment options, and will update in the future when these are available.

Alipay is a PayPal-like service in China. I’ve used it mostly for online shopping at www.taobao.com, but as with PayPal, you can also use to send money to an email address. Alipay uses the Bank of China as the conduit, and the government forbade banks from dealing in bitcoin earlier this month. So, no more transfers to rmbtb.com.

Tenpay is a similar service by Tencent Inc., makers of the QQ and WeChat instant messaging apps. I don’t have a Tenpay account, and I rather suspect transfers through it will also be shut off.

This change means my only option to buy bitcoins now is to go through Coinbase.

Since the Chinese were major players in bitcoin markets, it’s not hard to see why bitcoin prices against national currencies (which bitcoiners like to call “fiat currencies”) have dropped precipitously this month from a high arund $1,000. Preventing China’s banks from dealing in bitcoin means they are now reluctant to let their accountholders trade renminbi for bitcoin, which has in turn choked off demand.

As wonderful as bitcoin is as an idea, in practice we still need to pay our bills and buy stuff with normal currencies. Making it difficult to exchange BTC for national currencies will relegate bitcoin into a niche market from which it may never escape.

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One comment on “Bitcoin update: Trading Chinese renminbi just got harder

  1. Reply William C. Weaver Dec 18,2013 2:00 am

    SorryJohn, I think Bitcoins are a sham and wouldn’t give anyone dollars, goods or gold for any number of them.

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