Bitcoin has seen a price increase to $2,466, boosted by one of China’s biggest exchanges renewing withdrawals.

It had been a quiet week for the Bitcoin traders. Now one of the largest exchanges in China has said that it will allow their users to withdraw Bitcoins from their accounts again, giving the currency a boost in price.

The price had hovered around the $2,200-$2,300 mark for some days, but has since risen by as much as 4.4% in a matter of hours.

Exchange users in China were told in February that they would not be able to withdraw funds from their wallets. It followed a reprimand from the People’s Bank of China for their inappropriate use of KYC and AML systems.

“Serious violations”

Chinese regulators have been bullish over stemming the flow of capital outside of the country. Buying Bitcoins on Chines exchanges and then selling them on foreign equivalents allows investors to avoid official limits of converting the yuan into other currencies.

The watchdog met with nine Bitcoin exchanges and instructed them to abide by regulations. In a statement, it warned that platforms could be shut down forcibly if “serious violations” occurred.

The announcement sent the Bitcoin price plummeting by more than 10% at the time.

As a result, Chinese Bitcoins have been trading at a substantially lower value than those in other markets.

Yesterday (31st May), Chinese Bitcoin source cnlLedger announced that OKCoin China would resume withdrawals. The exchange is the largest in the country and accounts for 31% of all trades within the Chinese market.

Huobi and BTC China, also considered to be part of the nine exchanges targeted by the People’s Bank, have yet to make announcements about the state of their withdrawals.

In the immediate aftermath of the announcement Chinese Bitcoin exchanges were trading the currency at $2,340. The figure was around $50 higher than the comparative price in the US.

Bitcoin has also received extensive media attention in China, with reports calling it a high-risk, high-reward investment option.

Big trouble for little blockchain

Blockchain technology has been included in China’s 13th National Five-Year Plan, according to a document published by the country’s State Council in January this year. The plan stressed that blockchain technology is an area that China needs the strengthen going forward.

China is already experimenting heavily with the idea of digital currency and blockchain in the city of Shenzhen, where a partnership between the First Alliance of Digital Currency and the China Fintech Institute is underway.

The city, which has long been a pioneer for the opening up of Chinese technology to the world, is the third largest in China by financial assets.

by Alex Hamilton
Alex is Senior Reporter at IBS Intelligence, follow him on Twitter or contact him at: alexanderh@ibsintelligence.com
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