Chinese Bitcoin Traders Flock to LocalBitcoins After Major Exchanges Temporarily Suspend Withdrawals

Last week, the People's Bank of China scared many Chinese cryptocurrency exchanges after it issued a strong statement on the importance of KYC/AML rules, and the severe penalties for all financial enterprises that blatantly disregard financial regulations.

As a result of that warning, major Chinese exchanges halted withdrawals of digital currencies to revamp their anti-fraud & money-laundering checks. And it would seem that many Chinese investors have turned to LocalBitcoins (LB), an online marketplace where traders exchange the digital currency to other online payment services like PayPal.

Bitcoin trading volumes on LocalBitcoins in China hit a new all-time high for the week ending Feb. 11, 2017. Charts from show a surge of ¥6,599,940 worth of bitcoin transactions for that week.

LocalBitcoins volumes in the country have not come close to last week’s figure since the third week of June in 2016, when the last all-time high of ¥5,296,533 was recorded.

The demand in China for bitcoin is so great on LocalBitcoins at the moment, sellers are offering the digital currency with markups as high as ¥1000 over spot rate. At press time, the BTC/CNY rate on exchanges like Huobi is hovering around ¥6800.00.

While on Yunbi, at press time, the BTC/CNY rate is near ¥7050.00.

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