Bitcoin banned on Alibaba platform Taobao as China tightens rules
08 January 2014
China's largest e-commerce website, Alibaba Group Holding Limited is set to ban the sale of Bitcoin and other virtual currencies with the country's central bank tightening regulations in December.
Taobao Marketplace, one of the main platforms linking buyers and sellers on Alibaba, would bar Bitcoin sales from 14 January. The ban would also apply to related products, including mining software and hardware for the virtual currency, the company said on its website yesterday.
Bitcoin transactions were stopped by the country's central bank after the value of the virtual currency jumped 89-fold. The company said the move to ban the sale of virtual currencies and related products would help protect users.
On none of Alibaba's platforms had Bitcoin been an accepted payment method in the past, and the company's Alipay payment affiliate did not support websites that used Bitcoin, according to an email from Florence Shih, a spokeswoman for Alibaba.
Bloomberg quoted Wang Weidong, an analyst at Shanghai-based internet consultant IResearch as saying today that Alibaba's new rules might be due to recent central bank regulations and concerns about risks associated with Bitcoin. He added, the changes would have quite a big impact on Bitcoin trading in China.
Meanwhile, Bitcoin has emerged on the international scene as a highly-popular – and also highly-profitable – investment vehicle and potential currency.
Governments in Asia, in recent weeks, had frowned on Bitcoin recently and the Indian government issued a warning (See: After RBI warning, ED raids Bitcoin providers), while the Chinese government tightened oversight over the currency. The Malaysian Central Bank too has advised the country's citizens to exercise caution with Bitcoin use.
The currency is not legally recognised in Malaysia and the Central Bank made this clear in a public statement (See: Governments divided on Bitcoin's status as money). The government also added that it did not regulate Bitcoin, and could not offer protection as regards Bitcoin trading.
The bank, however, did not say that Bitcoins were illegal or outlawed rather, it cautioned citizens who were engaging in trading.
This stance aligns with the stance of other governments across the world.
Thailand, had come close to imposing an outright ban on the currency. Thailand's Central Bank had announced earlier that Bitcoin was illegal, and transactions in Bitcoin were also therefore illegal.
The bank itself does not have the legal authority to make such a ruling, but neither the parliament nor had the ministry of finance ruled against Bitcoin, which meant the status of the currency thus remained contentious in the country but for now the digital currency was not technically illegal.