Update to the update to the Bitcoin saga

Foreigners need not apply

JISHOU, HUNAN — So, I got a reply from BTCChina today to my inquiry about continued use of their services.

You can guess what it was.

But here it is from the horse’s mouth.

Good day!

Our sincere apologies for this matter. BTCChina will no longer allow foreigners to use our services. You cannot use BTCChina from now on.

Should you have further concerns, please do not hesitate to let us know anytime.

Thank you very much and have a nice day!

Best Regards,
Customer Service 1011

This reply has two explanations. Given that both Huobi and BTCChina had no problem before with my using their exchanges with a foreign passport as ID, this new policy confirms that the government is trying to restrict the flow of Chinese yuan out of the country, other than by official channels, and that government regulators want the Chinese Bitcoin exchanges to only deal with Chinese citizens, who would be easier to control legally (or extra-legally) than foreign residents.

While I have not heard back from Huobi about my bank card + passport issue, I can now assume that they will tell me the same thing as BTCChina — that Huobi can no longer allow foreigners to use their exchange.

For the time being, anyway.

Living here for so long has taught me that some Chinese policies are mutable, given enough time, and can be changed or dropped with no warning or explanation. So, it’s conceivable that in several months, both exchanges will once again open their services to foreigners. All the major Bitcoin exchanges have been trying to convince China’s banking authorities that their users are not moving large sums of money offshore with Bitcoin transactions. If that’s true, then the authorities would see little change in capital flight under the new exchange policies, and could loosen up those regulations in time.

I and other Bitcoining foreigners here will now need to use the P2P channels provided by LocalBitcoins.com and BitKan, which was in fact the original intent of Bitcoin’s creators. Bitcoin was designed to be a peer-to-peer mode of exchange, with no third parties (banks, regulators, payment clearinghouses, exchanges, etc.) being the middlemen. Exchanges facilitated fiat-to-Bitcoin exchanges and speculating on the markets. They were a convenience, but not a necessity.

So the government has merely driven Bitcoin traffic into a decentralized underground market that will be next to impossible to control, unless the government outlaws Bitcoin entirely. That it hasn’t already suggests China views Bitcoin as a useful economic tool. China accounts for 60% of the world’s Bitcoin mining, which means mining operations (like this one) bring millions of dollars into the Chinese economy. Rather than kill Bitcoin, the government would rather try to tame the beast to make it more tractable.

Unfortunately, we foreigners seem to be collateral damage in the process.


Also published on Medium.

Possibly Related Posts:

Leave a Reply

  

  

  

Facebook Auto Publish Powered By : XYZScripts.com