Bitcoin value

Baidu Jiasule, an online service offering protection for websites, announced over the weekend on its website that in a bid to protect customers and control the risks from using Bitcoin, it will suspend the acceptance of Bitcoin as payment.

The announcement said the price of Bitcoin has undergone major fluctuation recently and the suspension is also a response to the government's call to control risks from Bitcoin.

The People's Bank of China (PBC), China's central bank, said in a notice on Thursday that as a virtual product, Bitcoin does not have equal legal status as fiat currencies, and it cannot and should not be circulated in the market as a fiat currency.

In the notice, the PBC also banned all financial and payment institutions from establishing Bitcoin services due to the high risks.

Cheku Cafe, located in Zhongguancun in Beijing, told the Global Times Sunday it has stopped accepting Bitcoin as payment after the PBC released the notice.

Cheku Cafe accepted Bitcoin as payment for about a month and only a few customers paid with Bitcoin, said a staff member who asked to be anonymous.

After the PBC announced the notice, the intraday value of Bitcoin plummeted from 6,280 yuan ($1032.43) Thursday to about 4,669 yuan on Saturday, then increased to 4,888 yuan Sunday by press time, according to btc123.com, a Chinese Bitcoin trading platform.

Hong Kong Monetary Authority (HKMA) also said Friday that Bitcoin is not qualified to be a payment carrier or electronic currency because it is not endorsed by any real assets or issuers, news portal chinanews.com reported Friday.

The HKMA also said Bitcoin is highly speculative so people should be very careful about making any related transactions or investments, according to the report.

Leading Chinese search engine company Baidu Inc acquired Jiasule in August and Jiasule started accepting Bitcoin as payment in October, Bitcoin news portal bitcoinmagazine.com reported on October 17.

Recent media reports said that more than half of the world's Bitcoin transactions are done in China.