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China Bitcoin Businesses The Almighty Buck

Bitcoin Price Falls Again On Reports that China is Shutting Down Local Exchanges (cnbc.com) 115

Posted by msmash from the terse-regulations dept.
China's clampdown on cryptocurrencies has reportedly taken a new direction -- to close down local bitcoin exchanges. From a report: Initial reports from Chinese media that the government plans to close down domestic cryptocurrency exchanges have seen the virtual coin shed more than $100 since Friday. Bloomberg and the Wall Street Journal also reported Monday that that the country is planning to shut down digital currency exchanges. Bitcoin sunk to a low of $4,241 in late trading in the U.K. Friday, and reached a low of $4,108 on Monday, according to Coindesk data. It climbed to a record high of $5,000 dollars a little over a week ago, and has shot up by nearly 350 percent since the start of the year. The latest reported crackdown follows a decision by Chinese regulators -- including the People's Bank of China (PBOC) -- to ban initial coin offerings (ICOs). ICOs are a means of raising funds by selling off new digital tokens. A crackdown on ICOs would not affect the original cryptocurrency directly, but bitcoin still dropped more than $1,000 over a period of three days. China's latest move to shut down local exchanges would mark a new direction for the country in its efforts to regulate the market.
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Bitcoin Price Falls Again On Reports that China is Shutting Down Local Exchanges More

Bitcoin Price Falls Again On Reports that China is Shutting Down Local Exchanges

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  • Drop of $1000? $5000 - $4108 1000 ?? (Score:4, Insightful)

    by JcMorin ( 930466 ) on Monday September 11, 2017 @10:10AM (#55173829)
    Please, someone, verify the math... how did Bitcoin lost more than $1000 and still be above $4000 when the all time high was $5000.

    • Re: (Score:2)

      by millette ( 56354 )

      Well, it sank to $3940 during the 4th but finished the day a little over $4000, then reached $4600 over the next few days before falling to $4100 yesterday. Don't blink. So somewhere in there it lost $1000 although it gained half of it back along the way.

    • Please, someone, verify the math... how did Bitcoin lost more than $1000 and still be above $4000 when the all time high was $5000.

      By asking that question you have shown you clearly don't have what it takes to be an investment banker.

    • how did Bitcoin lost more than $1000 and still be above $4000 when the all time high was $5000.

      Bitcoin is so unstable and changes so fast, that by the time you finish your subtraction the numbers doesn't mean anything anymore.

      And I'm only half joking.

      Seriouly, do we *Really* need a new /. article each time the exchange value of BTC jolts ?
      At that pace we could actually use the exchange rate as an entropy source for random number generators.

      Stick to the bitcoin *protocol* as a way to make decentralized transactions only, and keep using *fiat* for your long-term storage needs.

  • I'm suprised nobody has started arbitrating between different BC exchanges. With the current volatility the opportunities are massive. I guess you can't really short-sell but with a minimal investment you could make a mint!

    • China subsidizes electricity and hardware for bitcoin processing. Are they trying to take over the global market while minimizing bitcoin's disruption in their own markets? That would follow with their methods for standard currencies.

      • China subsidizes electricity and hardware for bitcoin processing.

        Ha. well that will be another interesting aspect of bitcoin--- it will arbitrage electric power subsidies out of existence.

        Please correct me if I'm wrong because I might be but my educated guess about bitcoin is that there's no price bubble at all. My reason for stating this rests on the assumption that the price of mining a coin is exactly equal to the electricity and hardware costs plus a thin markup (thin-ness dictated by competition which is intense). By price here I mean the cost of buying a coin pl

        • You have identified a strength of Bitcoin, which is that the algorithm that limits its money supply also sets a maximum value at any given time, based on the cost of mining new coins. If there are a significant number of miners who can still profit at a market price of $4000, they will keep on mining. But at the same time, speculative trading in the outstanding supply of BTC can take place at any price level, and is not less frothy and speculative just because there can still be new mining.

          All of the econ

          • Re: (Score:1)

            by Anonymous Coward

            the algorithm adjusts the difficulty to maintain a constant increase in supply of btc, so there is no upper limit to the price. the harder people try to mine, the more mining has to be done to find a block.

      • Re: (Score:2)

        by mvdwege ( 243851 )

        bitcoin's disruption in their own markets?

        The only thing I have BitCoin seen reliably disrupt is the wallets of the gullible.

    • Only if those exchanges don't nail you on the buy & sell rates (they do), and then there's the BTC transaction fee to consider. I'm sure that if the difference in rates between exchanges is great enough to turn a profit, this arbitrage is already happening.
    • Who is surprised of this "extreme volatility"? This exponential price hike dwarfs the 2000 tech bubble. How can one expect this kind of growth to go on? It got totally out of control, so someday some big player will want to cash in, and the bubble will bust in panic.

      • So, you think Bitcoin is like tulips?

        Wrong!!!

        You can put tulips in a vase. (for a few days, anyway).

      • Point is that bitcoin still needs introduction for a lot of people.
        So the market is far from being saturated.
        The more people get word of bitcoin and develop an interest, and actually buy it, the more it will go up.
        If the price increases another factor 10 or hundred, you need to be a really big player if you want to disrupt the market.
        So, when the market is saturated we'll see a final price, but not a dump.

        Just my 2 cents...

    • Re: (Score:2)

      by qbast ( 1265706 )
      I looked at it, but it did not seem viable.

    • I'm suprised nobody has started arbitrating between different BC exchanges. With the current volatility the opportunities are massive. I guess you can't really short-sell but with a minimal investment you could make a mint!

      Hard to make a mint when a transaction takes hours to days.

      • That's not necessarily relevant, if your cash flow is big enough. Remember it's small profits repeated many times. Imagine one exchange will sell you a bitcoin at $5000 and another is still buying at $5100 because it updates slower, you've made 100$ (minus fees).

        But you'd have to invest larger amounts, and you're right, transaction times are quite limiting.

    • There are many people who do Bitcoin arbitrage. Software for doing so is readily available. Exchange fees and the time required to settle transactions limit the profitability and increase the risk. You don't know for sure if your transaction will settle until days later. Recently, there were 200,000 transactions awaiting settlement.

      There is also risk from exchange issues, and not just frauds and hacks. An FDIC-insured bank has to prove it has sufficient assets to cover liabilities, both liquid and long te

  • Hype (Score:1)

    by Anonymous Coward

    Yes, it did drop to below $4100, but it has now rebounded to nearly $4300. Yes it's dropped some compared to Friday, but it's about where it was last Tuesday. Whaddayaknow, it goes up, and it goes down. Look at the 30 day chart, and the trend looks like a fairly steady rise from about $4000 to $4250. Much as journalists would like the story to be "Oh noes, the bitcoin is crashing!", it doesn't really stack up (yet).

    Of course, reaching a peak value at a "significant" number like $5000 is a signal for a lot o

  • I think the drop is people over-thinking it. With no local exchanged, that just means people in China have more incentive to keep transactions on bitcoin, and not pull out to local currency. I suspect it will result in more demand and therefore higher prices.

    I also suspect that with the volatility, there will be a bitcoin futures market at some point.

    • Re: (Score:2)

      by Dr. Evil ( 3501 )

      "I also suspect that with the volatility, there will be a bitcoin futures market at some point."

      Stocks are like betting on a horse race with no finish line. Bitcoin is like betting on a horse race with no finish line and no horses.

  • Basically, after some of us pointed out that the bitcoin exchanges were enabling Russia and North Korea to delay climate change action, and China had decided to force all new vehicles to become electric, they had to do something.

    You can still exchange bitcoin legally, but only in person.

    Consequences are like that. China does what it's going to do.

  • I purchased my first Bitcoins about a week ago, and I'm known to have that kind of effect.

    I can also stop a cashier lineup just by standing in it.

  • China bubble will pop soon.

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