China Banning Payment Companies From Dealing With BTC Exchanges

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Earlier this morning, we posted some rumors that suggested a major shift in China regarding bitcoin adoption. As it were, it looks like they may be coming to fruition.

On Monday, some of the top third-party payment companies in the country met with officials from the People’s Bank of China — and while the meeting wasn’t explicitly about bitcoin, it reportedly became a talking point in the conversation.

“PBOC, in no uncertain terms, directed third-party payment companies not to do business with bitcoin exchanges in China,” said what has been called a reputable source to CoinDesk. So, we are basically dealing with payment companies who will back away and cut all connections with bitcoin exchanges, such as BTC China.

When this does finally happen (if it does), users will be able to withdraw cash from the bitcoin exchanges, but they won’t be able to deposit any funds. In other words, a huge blow to bitcoin exchanges in China.

The news has caused the price per bitcoin to drop to the low $700-range on Bitstamp, nearly 20% down in the last 24 hours.