BTCC cofounder and CEO Bobby Lee believes that China's immensely popular cryptocurrency bitcoin will come under regulation in future.
The statement comes after People's Bank of China (PBoC) launched an investigation in the aftermath of the immense price hike in bitcoin at the end of December 2016 and beginning of January 2017.
Acording to the reports, PBoC is fearful that black money hoarders are avoiding currency regulations and getting the money out of the country with the help of bitcoin.
"The answer is, I don't know when it will happen but I know it will happen. I have confidence of that because fundamentally I think bitcoin exchanges need to be regulated," said Lee to Business Insider.
The announcement by Lee comes after PBoC launched an investigation on BTCC, China's largest bitcoin exchange, along with other leading bitcoin exchanges like Huboi and OkCoin. The investigation started after these three leading bitcoin exchanges came under the scanner for deciding to charge trading fees from Jan. 24.
BTCC, Huboi, and OKCoin stated on their separate websites that they will be charging 0.2 percent per transaction, this fee they believe will "further curb market manipulation and extreme volatility."
It was earlier thought that the exchange portals levied this charge on trading fees as a part of an upcoming PBoC behind-the-scenes regulation. Lee, however, says that these allegations are untrue. The charge was slapped as he knew that authorities would have wanted him to do the same in near future.
What Is Bitcoin?
A bitcoin is a digital payment medium or payment system using cryptography to secure monetary transactions and control creation of excessive currency. The mode of payment was invented by Satoshi Nakamoto and was introduced in Oct. 31, 2008 and released in 2009.
Bitcoin Bubble In China
Compared to other parts of the world, bitcoin has gained immense popularity in China. The journey of the cryptocurrency has seldom seen a downward trend in the last three years and is currently estimated to take up 99 percent of all trade dealings happening in cryptocurrency.
The price hike in late December 2016 and early January 2017 got PBoC worried, which is why regulations regarding bitcoin may be on top of its 2017 to-do list.
Lee says that PBoC just wants to make sure that the price does not go "crazy" and "create a bubble" which have ramifications on investors. The severe scrutiny by PBoC on the market has helped pull down the price again, pushing the bitcoin back below $1,000.
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