The exchange that was summoned responded that it would resolutely maintain market stability and the establishment of a self-regulatory organization should be put on the agenda

On the evening of January 6, the People's Bank of China and its Shanghai headquarters met with three large Bitcoin trading platforms in Beijing and Shanghai, namely, Bihang, Huobi.com and BTCChina, and urged the exchanges to conduct self-inspection and rectification, which caused heated discussions in the community. The price of Bitcoin also fell, falling to as low as 5,600 yuan. As of press time, the price of Bitcoin has fallen back to around 6,300 yuan.

BTC China was the first to issue an announcement in response to the interview. The announcement stated that during the interview, "the head of BTC China introduced the operation of the platform and said that we will continue to strictly follow the relevant laws and regulations and the requirements of the regulatory authorities, operate in compliance with the law, actively carry out self-inspection and rectification, help maintain the stability of the Bitcoin market, and resolutely protect the interests of investors."

Other trading platforms also stated that they would actively cooperate with self-inspection and rectification, and refer to anti-money laundering laws, foreign exchange management regulations, etc. to further strengthen real-name verification and other measures to maintain stable market operation.

The lack of a clear regulatory agency is a difficult problem, and strengthening industry self-discipline is an urgent task

The central bank's interview with the heads of large exchanges inevitably reminds people of the "Notice on Preventing Bitcoin Risks" jointly issued by the central bank and five other ministries and commissions after Bitcoin soared to 8,000 yuan in 2013. The document caused severe market turmoil and the price of Bitcoin was cut in half. However, industry insiders generally said that the central bank's announcement of the interview was milder than the previous five-ministerial document. The main reason for the interview may be that the violent fluctuations of Bitcoin in the past few days were too eye-catching, and the purpose was to hope that the Bitcoin market could operate stably and in a standardized manner.

An unnamed insider told the reporter that the self-examination and rectification of the platform mentioned this time is new. The difficulty of self-examination and rectification is actually the lack of laws and regulations that can be fully referenced, and the lack of a clear regulatory agency that can connect with the trading platform.

“Bitcoin exchanges are similar to the stamp and coin transactions on the roadside in the past, which were formed spontaneously by the people. The three mentioned in this announcement can be compared to the larger stamp and coin stalls on the roadside. In terms of self-examination and rectification, assuming that these three companies charge transaction fees, they will naturally guide the transaction volume to other places that do not charge transaction fees, which has no practical significance for the regulation of the entire roadside stamp and coin market.

To regulate roadside stamp and coin stalls, one way is to set up stamp and coin markets, where merchants are registered and subject to industrial and commercial supervision, and consumers have channels to protect their rights and make complaints; another way is to set up stamp and coin exchanges, where licenses and documents are issued, and the money and subject matter are isolated from the exchanges, so that the exchanges can fully perform their work and hand over the funds and subject matter to third-party supervision.

The digital currency industry is still in its early stages of development. Before specific regulatory measures are introduced, strengthening industry self-discipline is the best option. Referring to the United States, its financial market self-regulatory organization, the Financial Industry Regulatory Authority (FINRA), can also, to a certain extent, strengthen investor protection and market integrity through supervision and technical support, making the US financial market an effective self-regulated market. In the interview, Huobi executives who participated in the interview also mentioned that the industry is also spontaneously planning to establish a self-regulatory organization.

The sharp fluctuations in Bitcoin prices have attracted the attention of all sectors of society, including regulators. The announcement issued by the central bank this time stated that the exchange’s self-inspection and rectification is the first step. In the future, there will need to be a clear regulatory agency to introduce specific measures with clear provisions and issue corresponding licenses. The industry must also establish a self-regulatory organization to strengthen self-discipline in order to achieve standardization and stability of the entire industry and market.