It was recently reported by national media outlets that new measures related to cryptocoins and anti-money laundering regulations have been pushed and discussed by the Central Bank of China, the PBoC, in conjunction with the National People's Congress of China. They will be directed to businesses and virtual goods platforms in the Beijing area that work with Bitcoin in an attempt to regulate the provisions of cryptocoins in internet and their possible scope in illegal activities such as tax evasion.
The measures promoted were discussed by the financial institution and the assembly members, who were informed about how the bitcoin trade industry worked, as well as the cases of money laundering and the illegal operations that were made in these businesses due to lack of regulations that avoid irregularities, as it is the case that they were not subject to the parameters of "know-your-customer" (KYC).
The regulations prompted by the Chinese finance authority seek to build in each of the exchange platforms, an internal organization or system that helps authorities avoid and counteract the money laundering that occurs within the platforms, assure that this could help to prevent transactions of funds that come from terrorist financing and sale of drugs. Another measure to take would be to force exchange houses to comply with prevention requirements such as: control measures, customer identification, transaction recording system, and inform the authorities of suspicious funds movements or large transactions.
Under these parameters, customers of the exchange platforms and virtual sales sites will be identified and certified if they wish to make any transaction. Therefore, to make any purchase through bitcoin users will be asked for an identity document that is valid for the authorities in order to ensure that such funds belonging to that specific website belong to him and have already passed their own anti-money laundering verifications. This would be the main proposal of the financial authority on identification that is still being discussed in the Bitcoin industry and has caused so many shocks and inconveniences, as it is considered a breach of privacy.
Apart from the rules of customer identification that will be shared responsibility of the user and the entity offering the exchange service, it was also stated in the document that the fight against money laundering should be the main responsibility of the Chinese exchange houses, which will be supervised and aided by the authorities and specialized agencies for greater effectiveness. Traders will also be required to make a record of transactions and identities that will serve as information to legal and law enforcement authorities in case any of the clients engage in an illegal activity.
The document also listed a suspicious transaction type group that has a specific and already studied behavior that should be followed by the companies as a protocol in order to be able to identify which transactions are suspicious and thus inform the Central Bank if there is any criminal attribute.