BTC China Accepting Bank Deposits Again
Published on January 30, 2014 at 13:32 GMT
Prominent Chinese bitcoin exchange BTC China is now accepting customer deposits via its corporate bank account, plus offering small prizes to its customers.
Bobby Lee, CEO of the exchange, confirmed that customers can now buy bitcoins from the exchange by depositing their funds directly into the company's account.
"Previously, we judged doing this as not being viable, however, we have since changed our stance. We looked again at the guidance issued in December and we think it's a reasonable for us to accept customer deposits via our corporate bank account," said Lee.
He went on to say BTC China now believes the main message in the memo issued by the People's Bank of China (PBOC) on 5th December was that banks in the country aren't allowed to set up or become a bitcoin business.
The memo stated that people in China are permitted to buy and sell bitcoins and stressed that that bitcoin exchanges should register with the Ministry of Industry and Technology (MIIT). Lee said:
"The fact the PBOC said exchanges need to register with MIIT essentially means it recognises exchanges as a business category and BTC China as a legitimate business."
He explained there's the potential the central bank and/or the Chinese government could "change the rules of the game", enforcing stricter policies, but for now he is confident his company is not doing anything wrong.
BTC China has not experienced an upturn in trading volume since the company reinstated direct deposits, this could be because the move has not been publicised, but Lee puts it down to other factors.
"Volumes in China have been down since December. A lot of the people we have spoken to have stopped trading, they've cashed out, so activity has calmed down a lot. Volume is certainly going to be low for the next few days because we're going through a Chinese New year period," he explained.
Lee said BTC China decided to take advantage of the current lull in interest in order to make sure the new deposit procedure runs smoothly.
BTC China has also launched a promotion to bring awareness to its Maker-Taker programme and reward its customers.
Maker-Taker is a system whereby those posting multiple buy/sell offers and increase liquidity in the market (“makers”) are paid a fee, whereas those who take the offers and remove market liquidity (the “takers”) are charged a fee of 0.3%.
Until 15th February, company is giving 1,000 RMB ($165) to one maker and one taker every time the amount rebated to makers exceeds 100,000 RMB.
"The prizes go to the maker and the taker who push the rebate threshold over the next 100,000 mark. We have already given out over 3m RMB in rebates and given prizes to 62 winners," Lee explained.
He went on to say BTC China's domestic competitors charge 0% commission, but he believes Maker-Taker is a more compelling deal. Lee said:
"Obviously if you're a taker, to go and buy and sell bitcoin actively, you have to pay a small commission, however, the reason you pay for that is access to the liquidity and the depth of our order book."
Because of this model and the depth of the order book, BTC China states customers can easily buy and sell tens of thousands of bitcoins without moving the market.
"We're not trying to be different for the sake of being different. We're trying to be innovative and benefit bitcoin in China. The Maker-Taker method accomplishes two things – it brings more market depth and more liquidity to the site, plus it reduces volatility, which makes for a healthier for market for bitcoin in China," Lee concluded.
What do you make of BTC's new promotion and the Maker-Taker model in general?
Chinese money image via Flickr.
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