5th May,Fujian-According to the official release of China Securities Regulatory Commission ( CSRC), a meeting on rectifying various exchanges was held in Fujian province. The meeting was hosted by Liu Shiyu, the Chairman of CSRC, and therefore considered the highest level of meeting. Usually it represents the voice from the top. Regulatory requirements and compliance instructions released through such meeting would impact various exchanges across the country. Bitcoin exchanges are no exception.

CSRC meeting for rectifying various exchanges. photo credit: CSRC

The regulatory storm aiming at various exchanges has been launched on 9th January after the inter-ministerial joint meeting. The timing was in line with the on-site inspection carried out on Bitcoin exchanges. The latest meeting on 5th May was to push the local governments to deal with illegal exchanges accordingly, to prevent and mitigate financial risks.

Various regional authorities are required to adhere to same criteria when dealing with various exchanges.

Several options are provided when handling the exchanges:

1. Shutdown.

2. Rectification

3. Merging

4. Re-branding

The report stress that the illegal exchanges that fail to comply with rectification requirements and has not obtained approval documents from provincial governments must be shut down.

The report specifically mentions the illegal “micro-trading” platform, which are built up on wechat and allows people to trade without using other apps. With around 900 million active users online, wechat has literally change many people’s lives and their investment habits. These “micro-trading” platform rise from the blank spot of regulation and has caused many people heavy losses.

The meeting made it clear that all local departments should establish a long-term mechanism for the development of trading venues. All regions should follow the benchmark of serving the real economy to determine the integration or merging of trading exchanges.

In principle, only one exchange is allowed for one business.

These instructions are not in favor of Bitcoin exchanges as they are not in line with the above principles. First of all, Bitcoin is defined as “virtual” goods in its best interest and so far there is no sign of connecting bitcoin with “real economy” in China. Blockchain is hot for Fintech but bitcoin is often smeared in the mainstream media coverage.

8btc forum user sees the meeting differently. In a post analyzing the impact of the meeting, “kinlai” believes that the news is good for Bitcoin Exchanges. He claims that bitcoin is not categorized as stocks and the meeting’s resolution doesn’t apply to Bitcoin. He also expects the bitcoin withdrawal will resume once the storm is cleared. His good wishes is soon challenged by others: