Alibaba Group halts bitcoin sellers on Taobao marketplace

The ban follows stricter rules by China's financial regulators

By , IDG News Service |  IT Management

Vendors on Taobao, China's largest e-commerce marketplace, will no longer be able to sell bitcoins following a ban by owner Alibaba Group, following stricter rules the country imposed last month around the virtual currency.

The ban is "in the interest of consumer protection," according to an Alibaba Group spokeswoman.

Bitcoin's price surged in late November on interest from China, going from around US$100 per bitcoin to more than $1,000. It promptly fell after China's financial regulators banned banks from dealing in bitcoin, saying it does not have the same legal status as currency.

The regulators also said the bitcoin is not issued by a central monetary authority and that transactions could be performed anonymously. The country has not, however, banned people from holding bitcoins.

No country has banned bitcoin, but many are studying how it fits into existing financial regulations with an eye to prevent money laundering or tax evasion

A search of Taobao showed a range of bitcoin-related items, from small quantities of the virtual currency to guides for how to "mine" bitcoins, or configure computers to become part of its peer-to-peer transaction network.

U.S. auction giant Ebay doesn't let buyers pay for goods in bitcoin, but people do sell bitcoins on its site. Ebay appeared to be investigating bitcoin, however, as it posted a video around September asking users their views.

Earlier this week, game developer Zynga said it is testing bitcoin for in-application purchases of virtual goods for seven games offered through its portal.

Send news tips and comments to jeremy_kirk@idg.com. Follow me on Twitter: @jeremy_kirk

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