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Did Chinese Rumors Crash the Bitcoin Price? How Accurate Are They?

Source: bitcoin

Bitcoin Chinese Money

Bitcoin’s recent bull run ended with a thud on 3rd November, reaching above $740 before crashing to around $685 in just a few hours. Was a rumor of further Chinese restrictions on Bitcoin exchanges to blame? And if so, how accurate is the news?

Also read: AirBitz and WINGS Partnership Secures Future of DAOs

Chinese Rumors Start to Spread… Again

Dramatic financial news site ZeroHedge reported on 3rd November that Chinese regulators “are considering policies including restricting domestic bitcoin exchanges from moving the cryptocurrency to platforms outside the nation and imposing quotas on the amount of bitcoins that can be sent abroad.”

While speculators have often wondered about Bitcoin’s effect on capital flight from China, others doubt it has any impact at all. BTC price movements in the past have appeared to correlate with Chinese monetary policy announcements.

ZeroHedge cited “Bloomberg sources” as the story’s origin, though provided no link. On Reddit, readers were skeptical given recent positive signs such as last weekend’s First World Blockchain Conference in Changsha. Several high-level political officials attended the conference, which was organized in part by China’s Ministry of Industry and Information Technology (MIIT).

By press time, the BTC price had rebounded substantially back to $702, though not back to its previous highs.

Has Anyone Else Heard the News?

Chinese Bitcoin news and information portal BitKan said the Bloomberg news was a hot topic in its office this morning. However although other media outlets were repeating the story, no-one has been able to find where the original report came from.

Local Chinese news reported the information as such (translated):

“According to Bloomberg News, PBOC and other Supervision department are analyzing and planning to launch measures, to restrain exchanging CNY to USD via Bitcoin transactions. Measures which are in consideration may include restraining Chinese exchange platforms transferring Bitcoin to overseas exchange platforms, or setting limits on amounts of bitcoin removed to overseas exchange platforms.”

BitKan reported no-one in the Chinese Bitcoin industry had heard any information from the government directly. However, since Chinese policy rumors first started to impact Bitcoin in 2013, the government has rarely communicated with companies directly.

However founder Edward Liu suggested the news may not be bad, even if true. Speaking to Bitcoinist, he said:

“if the news is true, it shows that the Bitcoin industry has got growth in China. Also, being regulated is a necessary stage for every growth industry. If the Chinese goverment lauches any regulation about the Bitcoin industry, BitKan will make efforts in cooperation.”

Other China-based industry representatives also said they hadn’t heard any such news.

Virgilio Lizardo Jr. of Bitcoin multi-services firm Bitbank, which is involved in both exchange and large-scale mining operations, said: “Total nonsense, China is taking a more positive approach to Bitcoin and blockchain technology. The conference is proof positive of that.”

China’s Bitcoin ambassador Willson Lee, who just assisted in organizing the recent blockchain-themed conference for high-level Chinese party officials, said he’d not heard anything about a policy change.

Let’s Wait and See

So was the original report real? Or are outlets simply re-reporting a rumor, with the inevitable price movements?

At press time, the industry is still waiting for confirmation from sources other than Bloomberg. While the news does not appear anywhere on Bloomberg’s news site, the service provides an instant news feed to terminal subscribers which often does not appear elsewhere.

Bitcoinist will keep an eye on this developing story and report updates as they become available.

Did you make or lose any money on the previous 12 hours’ volatility? How much influence do Chinese traders have on current bitcoin value? Let’s hear your thoughts.

Images via Shutterstock

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Did Chinese Rumors Crash the Bitcoin Price? How Accurate Are They?

Led 05

More Signs of Trouble in Asia: Barclays to Cut Investment Banking Jobs

Source: bitcoin


Reuters reports that Barclays Bank will announce investment banking job cuts across Asia sometime next week. The news publication’s sources said that these jobs cuts will include closures in South Korea and Taiwan. 

Also read: Grantcoin Makes Regulatory History in the US, Plans to Launch Two New Charity Programs 

These rumored cuts come after the Asian region’s failure to produce sustained growth in the post-2008 economy created a difficult business environment for investment bankers in Asia. In addition to these suspected cuts, Reuters reported on Monday that Barclays will close its Indian equities business as part of its Asian cost-cutting measures.

Barclays’ Asian cuts include eliminating corporate finance and advisory positions in South Korea and Taiwan, along with equities sales and research staff in the region. In total, Reuters’ sources expect Barclays to cut at least 50 Asian jobs.

Bitcoin Unfazed in the Midst of Asian Turmoil

This report comes in the middle of wide economic uncertainty in the Asian region, mostly due to China’s faltering economy. China struggled for much of 2015, and the developing country suffered a massive stock market crash on Monday, which effected markets across the globe.

Bitcoin is usually affected by financial worry and speculation coming from Asia — specifically China — due to the large population of bitcoin miners and traders in Asia. However, the recent turmoil has not seemed to faze the bitcoin markets, which have been chugging along in the low $430s for the last week. Even on Monday, the day of China’s stock market crash, bitcoin trading remained fairly quiet, with exchanges across the globe showing sideways activity.

What does this mean for Bitcoin? Are traders and speculators waiting for additional information from China and Asia before acting, or is there something else going on in the trading community that is making speculators ignore Asian financial troubles? It is possible that traders currently have more of their attention on internal happenings in the bitcoin community rather than the outside economy. The bitcoin community is gearing up for a block reward halving this year, with many believing that the diminished growth in the bitcoin supply will push the price upwards as demand continues to grow. Additionally, the block size debate shows no signs of coming to an end in 2016, and the issue will become more urgent as new blocks are expected to start hitting 1 MB sometime this year.

These two major issues in the bitcoin community may have traders holding onto their coins in anticipation of internal activities that will affect the digital currency more than developments in the global economy. Bitcoinist will continue to follow the situation in Asia and report on any change in the bitcoin markets that may be related to the current financial landscape in the region.

What do you think of Barclay’s rumored cuts in Asia? Let us know in the comments below!

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More Signs of Trouble in Asia: Barclays to Cut Investment Banking Jobs