Wednesday, December 18, 2013

China Bans Bitcoin, Value Drops...or is it as Causative as Stated?

China’s biggest Bitcoin exchange was forced to stop accepting deposits in the Chinese currency on Wednesday, sending the price of the virtual money tumbling in one of its biggest markets globally.

The exchange, BTC China, made the announcement in a post on its verified account on Weibo, China’s Twitter-like messaging service.

The development comes less than two weeks after China’s central bank and four other government agencies that regulate finance and technology issued a joint announcement banning Chinese financial institutions from dealing in the virtual currency.

“For reasons we all know, BTC China has had to cease renminbi-account charging functions,” the exchange said in its message, referring to accounts in the Chinese currency. It said that it would continue operating and that deposits denominated in Bitcoins as well as renminbi withdrawals would be unaffected.


I've grown curious about cryptocurrencies over the past six months.  I've been following mtgox as a source of information for market price of the coins.  The price actually dropped there for bitcoins a couple weeks ago from over $1k to $800.  Today its running between $455 to $750.  While I am sure the drop is real, I'd also speculate there was a bubble present already which was deflating. 

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