China’s top e-store bans trading of Bitcoin and sales of Bitcoin mining kit

Taobao, China’s biggest online marketplace for amateur shopkeepers, has said it will impose a blanket ban on selling anything related to Bitcoin. That means the vast e-store’s seven million online merchants will no longer be allowed to sell or trade bitcoins, sell bitcoin mining equipment, or sell Bitcoin mining tutorials.

The ban on Taobao begins on January 14. It applies to all virtual currencies – such as Litecoin, Dogecoin, KardashianKoin, CoinyeCoin, PPCoin (I might have made one of those up). The notice of the ban was posted to Taobao’s rules board for merchants, and was spotted by the QQ Tech news portal. The full Taobao directive can be seen here (in Chinese).

A search for “bitcoin mining machine” in Chinese on Taobao yields over 1,400 results right now (pictured below); a search for “bitcoin” brings up nearly 4,500 results, mostly for Bitcoin sales and trading. All that will disappear later this month once the ban is put into place.

Click to enlarge screenshot.

But Taobao’s impending ban is puzzling. While China’s Central Bank has decreed that Bitcoin and any other virtual currency cannot be used as a currency (ie: for buying and selling stuff), people may still trade it and invest in it as a commodity. In theory, that makes it fine to trade online, and perfectly legal to buy virtual currency mining kit, so long as everything is paid for with a proper currency like China’s RMB. It’s likely there’s a legal issue with the sale/trading of virtual currencies outside of government-approved exchanges. In an email conversation with Tech in Asia, an Alibaba representative declined to comment on why this ban goes beyond what China’s Central Bank has ruled upon. (Update: Alibaba states: “In the interest of consumer protection, Taobao Marketplace has banned the sale of Bitcoins on the platform”).

(Editing by Terence Lee)