Jason Del Rey

Recent Posts by Jason Del Rey

China Bitcoin Exchange CEO: We’re Not Giving Up Yet


The largest bitcoin exchange in China, BTC China, is in peril after regulators in the country reportedly moved to block payment processors from accepting the virtual currency. The move leaves the exchange without a way to accept new Chinese yuan deposits and could lead to it shutting down.

In an interview with AllThingsD this morning, BTC China CEO Bobby Lee said his 30-person company hasn’t given up on keeping the exchange afloat. Lee said his Shanghai-based operation has been in talks with other payment processors about working with the exchange to reinstate Chinese yuan deposits, but hasn’t yet reached any agreements.

“Whether or not they’re told not to do business with us is something else entirely, because we’re not privy to that conversation,” he said. “The assumption is some of the past third-party payment processors have declined us because they’ve been told not to do it or suppose it’s high risk. But that’s only speculation.”

If BTC China does not find any takers, Lee said, the company may explore ways to accept deposits of the local currency without working with a third-party company. Lee declined to talk specifically about how that might work, because he said his company is still vetting its options with lawyers and trying to get clarity from Chinese regulators.

If both paths fail, BTC China will likely have to shut the exchange down.

“Without a valid means for customers to deposit funds, then our bitcoin exchange model breaks down,” Lee said.

Lee isn’t ready to call that outcome likely, though, noting that only two days have passed since deposits were cut off.

“It’s still early,” he said. “Our exchange is operating. The prices are volatile, but buyers are able to buy, sellers can sell, renminbi withdrawals are happening, but deposits are not happening. So, it is what it is.”

Bitcoins were trading at the equivalent of about $550 on the exchange at the time of writing. Meanwhile, the CoinDesk Bitcoin Price Index, which is the average of prices on three exchanges, not including BTC China, currently pegs the currency’s value at $665. Bitcoin was trading as high as $1200 just three weeks ago.

It’s not clear how much longer BTC China can remain a viable exchange without new deposits. What is clear, though, is that Lee seems committed to carving out a new path for BTC China, still involving bitcoin, if the exchange closes.

“Whether we will remain a bitcoin exchange will highly depend on how the regulators will allow for bitcoin exchanges to exist in China,” Lee said. “But in some sense we are at the mercy of regulators and government. If this cannot continue, I assure you we will find a new model and come up with new products and services to allow our customers to utilize their bitcoin.”

“We got venture capital funding for a reason,” Lee added, speaking of the company’s $5 million investment from Lightspeed Partners and Lightspeed China Partners. “To safeguard for this rainy day.”

Latest Video

View all videos »

Search »

There’s a lot of attention and PR around Marissa, but their product lineup just kind of blows.

— Om Malik on Bloomberg TV, talking about Yahoo, the September issue of Vogue Magazine, and our overdependence on Google