My understanding is that now China government clarified their policy towards bitcoin:
1) Bitcoin is a virtual commodity. It's not a currency so it cannot be used as a currency.
2) Bitcoin exchanges have to take some measures to verify users' identities and avoid money laundering.
3) Avoid using 'virtual currency' in the media to avoid misleading investors.
Actually it is not a bad news. Bitcoin has never been used as a currency in China (except two attempts did by a branch of Baidu and China Jiangsu Mobicomm). People buy them mainly for speculation and transferring funds to overseas.
Previously people may worry about the legality of bitcoin exchanges. Now this notice actually almost officially announces that all bitcoin exchanges following the rules will be legal.
1) Bitcoin is a virtual commodity. It's not a currency so it cannot be used as a currency.
2) Bitcoin exchanges have to take some measures to verify users' identities and avoid money laundering.
3) Avoid using 'virtual currency' in the media to avoid misleading investors.
Actually it is not a bad news. Bitcoin has never been used as a currency in China (except two attempts did by a branch of Baidu and China Jiangsu Mobicomm). People buy them mainly for speculation and transferring funds to overseas.
Previously people may worry about the legality of bitcoin exchanges. Now this notice actually almost officially announces that all bitcoin exchanges following the rules will be legal.
I'm perfectly happy if China views Bitcoin as commodity only within the country, as you noted, that is generally how it has been treated in China anyway thus far anyway. We have the whole rest of the planet full of countries that can use it as a commodity and as a currency if desired.