In other countries, bitcoin currency is receiving more and more scrutiny, as exchanges increase. The Chinese central bank increased due diligence of the country's bitcoin exchanges earlier this year, a move that prompted the companies to stop margin lending and introduced trading fees.
Sheng Songcheng, adviser to the People's Bank of China (PBOC), commented on the practices, in an interview with financial magazine Yicai published late Thursday.
"Bitcoin does not have the fundamental attributes needed to be a currency as it is a string of code generated by complex algorithms...But I do not deny that virtual currencies have technical value and are a type of asset," he said.
His comments have led to a string of confused investment consumers who value the profits of bitcoin exchange as currency. According to Songcheng, the bitcoin deflationary nature will not allow it to become a currency. If a country were to try to use bitcoin as one, the country would immediately face an economic collapse.