Bitcoin investigation looks into possible fraud

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China is sending investigators to the offices of Bitcoin trading platforms in Beijing and Shanghai in a campaign tightening regulation of the virtual currency, according to two separate statements from the People’s Bank of China (PBOC) and the PBOC Shanghai Head Office on Wednesday.

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The platforms include BTCC, Huobi and OKCoin, major trading platforms of the encrypted currency, whose value has fluctuated wildly in the past two months.

The investigators will look into possible market manipulation, money laundering, unauthorized financing and other issues that expose the financial market and investors to risks, said the statements.

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The PBOC Shanghai Head Office has previously warned investors over the risks of storing value into the virtual currency, which is “not and should not be regarded and used as a currency in circulation,” according to a statement the office posted on its website last Friday.

Bitcoin’s value reached a three-year high of about 8,700 yuan (1,257 US dollars) last Thursday, but saw a one-day loss of about 15 percent the very next day.

BTCC data showed that the Bitcoin price dropped 6.55 percent on Wednesday to 5,915.55 yuan per unit as of 6 p.m. Beijing time.

(Based on an original story by China Daily)‍