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People’s Bank of China Takes More Active Oversight Over Bitcoin Exchange Startups

The People’s Bank of China, China’s central bank, has stepped up efforts to review and engage with blockchain startups, after a series of high-profile bitcoin exchanges have met with local authorities.

China’s three largest bitcoin exchanges were visited by representatives of the People’s Bank of China earlier this week, with BTCC, OKCoin and Huobi welcoming the move, as the next step of official engagement en route to establishing clearer compliance criteria in this emerging space.

The on-site visits are a common feature of government regulation in China, and according to Bobby Lee, CEO of BTCC, have come after several years of signalling for further attention.

As these companies expand their offerings and continue to test new innovations around the blockchain, establishing a clearer framework for regulation has become essential in shaping the future of these markets.

According to a translated statement from the People’s Bank of China, the move was designed to ensure regulatory compliance, while learning more about the operations of these bitcoin platforms.

“The checks focused on whether the firm was operating out of its business scope, whether it was launching unauthorized financing, payment, forex business or other related businesses, whether it was involved in market manipulation, anti-money laundering or (carried) fund security risks.”

While little has been shared about the detail of the visits, analysts have suggested it could mark the start of a period of closer oversight and engagement from the central bank, a development that CEOs and founders alike have welcomed.

This will mean greater scrutiny for businesses operating in the space, but at the same time will help shape the future regulatory framework through which these platforms will operate.

The visits come at the outset of what many have called the blockchain’s golden year, as test models move into more market-ready phases of their development.

As blockchain startups worldwide vie for a slice of the rapidly growing markets in bitcoin handling and wider blockchain applications, the visits from the central bank combine with efforts from regulators and authorities worldwide as they move to establish a workable marketplace for bitcoin operators.