Bitcoin Tumbles After BTC China Halts Funding Amid Concerns PBOC About To Get Serious

Tyler Durden's picture




 

Bitcoin prices tumbled almost 15% as Chinese bitcoin exchange BTC China announced it has stopped accepting RMB deposits to user accounts from a major bank. As Coindesk reports, Management decided to proactively halt deposits from one of the country’s largest banks, China Merchants Bank, after the bank posted on its public website that it would no longer allow its customers to engage in bitcoin-related transactions, and said essentially it would require all such businesses to close their accounts. Withdrawals, of course, are allowed, but as Coindesk goes on to note, that while the PBOC's 'official' policy on Bitcoin has not changed since December, this 'pre-emptive' move may suggest he PBOC would soon set stricter rules about how its earlier edicts should be followed.

 

 

As Coindesk reports, management decided to proactively halt deposits from one of the country’s largest banks, China Merchants Bank, after the bank posted on its public website that it  would no longer allow its customers to engage in bitcoin-related transactions, and said essentially it would require all such businesses to close their accounts.

A rough translation of BTC China’s Weibo post reads:

“Due to a notice issued by China Merchants Bank, BTC China, out of consideration for user security and stabilization operations, decided to suspend the credit of accounts with RMB.

For subsequent updates, please pay attention to our website and Twitter, thank you again for your interest and support of BTC China.”

BTC China CEO Bobby Lee said his company had not yet any direct notifications from any of its banking partners, but was ready to act should such information arrive. Apart from the China Merchants Bank website posting, which did not specify any exchange by name, no other banks have stated their intentions as yet.

This followed reports last week that financial institutions were preparing to sever links with bitcoin exchanges, after closed session meetings with People’s Bank representatives.

 

...

 

The PBOC itself has continued to deny that it will ban bitcoin outright, though it has not made any public statements about how it intends to restrict digital currency use in the country.

 

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The meetings were reportedly more grave in tone than on previous occasions, suggesting the PBOC would soon set stricter rules about how its earlier edicts should be followed. As well as preventing users from funding their bitcoin exchange accounts, the new guidelines could eventually limit their ability to withdraw from bitcoin and litecoin into yuan as well.

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Sun, 04/27/2014 - 14:29 | 4701369 Matt_Master
Matt_Master's picture

Fonestar - we have a problem...lol!

Sun, 04/27/2014 - 14:34 | 4701384 agent default
agent default's picture

Fonestar is busy.  He is buying the dip.

Sun, 04/27/2014 - 14:36 | 4701392 Stackers
Stackers's picture

The move was a big yawn on a technical basis. It's been bouncing off $500 resistance for a while now.

Sun, 04/27/2014 - 14:41 | 4701404 Xibalba
Xibalba's picture

I was gonna buy $1500 worth when it was around 10 bucks. I couldn't find a way do do it without giving away all my personal info.  Missed the boat, but I think I may get another shot at it.  

Sun, 04/27/2014 - 14:58 | 4701441 hot sauce technician
hot sauce technician's picture

Don't listen to me, but at these prices btc is a buy. I am starting to accumulate and hoard.

Ever done international transactions? You know how you get hammered by the banks? Exchange rates, fees etc? Enter btc. Cut out all third party interlopers. This concept is too incendiary for simple minds to fathom. It's simplicity almost makes it seem unrealistic. Just need faith to build, and ma and pa will one day be using this tech. The Kenyan and his ilk will be left in the dust with their cronies/masters.

Sun, 04/27/2014 - 15:16 | 4701488 Soul Glow
Soul Glow's picture

I won't listen to you.

Sun, 04/27/2014 - 16:06 | 4701657 CH1
CH1's picture

Oh no! Bitcoin is dead!

AGAIN!!!

I think we're at 14 deaths now.

This time for sure?

Sun, 04/27/2014 - 16:19 | 4701716 BigJim
BigJim's picture

Just how many lives does bitcoin have, anyway? Obviously rather more than a cat, if it's died 14 times already.

But does it have as many lives as two cats? Three?

Sun, 04/27/2014 - 16:27 | 4701743 spine001
spine001's picture

The problem for bitcoin's survival right now is that at 500 the cost of electricity for providing the computer power that supports the network is way above the payment in transaction fees and mined bitcoins given the increases in mining difficulty. 

Sun, 04/27/2014 - 17:24 | 4701894 OpenThePodBayDoorHAL
OpenThePodBayDoorHAL's picture

Self-adjusting. If mining is unprofitable, miners drop out and the difficulty drops. Then it's profitable again. The self-adjusting just takes a little time. Next question?

Sun, 04/27/2014 - 17:49 | 4701961 boogerbently
boogerbently's picture

Bitcoin???

Yugos, 8-tracks, rotary phones.......

A novelty item, like "owning" part of Green Bay.

Sun, 04/27/2014 - 17:52 | 4701972 fonestar
fonestar's picture

OMG!!!

 

fonestar waits patiently for decaweeks for a Bitcoin article, turns his back for five minutes and wtf?

 

BITCOIN!!  SATOSHI WE LOVE YOU!!

Sun, 04/27/2014 - 18:10 | 4702031 nmewn
nmewn's picture

I gotta admit, you're one of the most persistent pumpers I've ever run across. What have you got to say to everyone who took your advice and bought at a thousand bucks...bagholders?

Sun, 04/27/2014 - 18:14 | 4702043 fonestar
fonestar's picture

fonestar would first say, "fuck you" and then fonestar would say,  

"BUY MOAR BITCOIN!!"

 

Sun, 04/27/2014 - 18:17 | 4702055 nmewn
nmewn's picture

Just what I'd expect from a psychopath.

Sun, 04/27/2014 - 18:18 | 4702058 fonestar
fonestar's picture

fonestar is the biggest Bitzealot on this virtual planet.

Sun, 04/27/2014 - 19:21 | 4702236 boogerbently
boogerbently's picture

http://www.coindesk.com/price/

 

Check the "1 year" or "all" chart.

 

It's like a biotech "penny stock".

Mon, 04/28/2014 - 08:03 | 4703382 wallstreetapost...
wallstreetaposteriori's picture

oh nevermind... I thought you posted that you were the biggest pole smoker on this virtual planet.  My mistake.  Just for enterainment...

https://www.youtube.com/user/weihrauchfan1999/feed

Sun, 04/27/2014 - 18:16 | 4702052 DoChenRollingBearing
DoChenRollingBearing's picture

 

 

nmewn

It's all good, I bought them knowing full well they are volatile.  BTC is a good speculation and has certain features that I like.  And, it does have a genuine possibility of spiking higher.  It's an asset class, volatile though it is.

Sun, 04/27/2014 - 18:23 | 4702070 boogerbently
boogerbently's picture

Bitcoin is ONLY credible as an investment (short term).

Buy low,

Sell high.

IF it's available to you while still high.

Sun, 04/27/2014 - 18:25 | 4702076 fonestar
fonestar's picture

Just BTFBitD!!

Buy low, get high with Satoshi!

Sun, 04/27/2014 - 19:00 | 4702184 nmewn
nmewn's picture

DoChen,

I can't stand in the same room with fonestar, so I won't...he's obviously insane, in my opinion.

You're a grown man and can decide for yourself. As far as I'm concerned its not an asset class at all as nothing backs it but faith in an already vulnerable system and it can't be held (its really just a Trojan Horse tryout for electronic money-labor/credits but whatever) and the only possible use I would ever have for it, is transferring funds short term overseas to an anonymous account, to be transferred again to another until muled to me.

To each his own, be careful bruh.

Sun, 04/27/2014 - 19:23 | 4702239 DoChenRollingBearing
DoChenRollingBearing's picture

It is cool, bro.  I rarely make big bets.  It has taken me decades to get where I am in Au holdings.

It is possible that fonestar is jacking with us, nmewn...

;-)

Sun, 04/27/2014 - 19:55 | 4702291 nmewn
nmewn's picture

Its also possible he's not then as well, isn't it? I've never found someone who speaks of himself in the third person to be trustworthy or sane. Why would anyone do that?

It means he's dead inside to me. I don't want anything to do with him.

Conversely, maybe thats his game, if he's trying to drag down BitCoin with his antics...either way, its deception.

Hey, knock yourself out, free world and all.

Seeya.

Mon, 04/28/2014 - 00:11 | 4702930 fonestar
fonestar's picture

fonestar is managed by PAL.

Sun, 04/27/2014 - 19:50 | 4702278 Seer
Seer's picture

"its really just a Trojan Horse tryout for electronic money-labor/credits but whatever"

I think that this needs to come out of the parenthesis!

It's really like this, the spooks and goons are strategizing for any postions that the peons are going to take: and let's face it here, none of us are really a threat to move any currency markets.  They've got their high-tech boys filtering, pattern-matching and capturing ALL electronic communications.  And in a neighborhood near most they've got the boots-on-the-ground types sniffing here and there (though mostly looking for big movements because they don't have the ability to really do far-ranging sweeps).

I don't see myself ever standing up to the point of encountering a last-stand shootout over a crypto-currency issue, nor PMs.  My wife and my land?  Have to get back to you on that, I think that this wire is hot...

Sun, 04/27/2014 - 20:05 | 4702313 nmewn
nmewn's picture

Every wire is hot on ZH...lol.

When deception becomes a normal way of existence, who's to say that the UPS driver who just got shot wasn't a spook and gunned down, deservedly so?

They breed the paranoia & suspicion, so why not give them mayhem and see if they can stand the disorder? ;-)

Sun, 04/27/2014 - 18:53 | 4702167 LM
LM's picture

What about the people that bought gold and silver near their highs per the advice of gold and silver pumpers?

Sun, 04/27/2014 - 19:07 | 4702205 nmewn
nmewn's picture

Those pumpers share my disdain but if you look back I was never one of them. This is not a sprint, its a marathon. The sooner you understand that the better off you'll be.

The only "pumping" I EVER ENGAGE IN is telling people, once in hand, no one knows you have it (unless you tell them) as it should be.

Sun, 04/27/2014 - 17:34 | 4701919 BTFDemocracy
BTFDemocracy's picture

The difficulty adjusts. As non-profitable miners leave, the cost of mining goes down and network equalizes. The trick is that Bitcoin mining has never been very profitable, unless you HOARD the coins and don't sell them for another year or two...

Sun, 04/27/2014 - 18:32 | 4702099 fonestar
fonestar's picture

YES!

Bitcoin mining price hysteresis.

Sun, 04/27/2014 - 17:54 | 4701981 fonestar
fonestar's picture

It looks like we will see Bitcoin in the $300's this week!

Get back and load up those virtual dump trucks at these levels!  fonestar will sell out his whole damned family to get more che@p c0inz now!  fonestar sell you all out!

Sun, 04/27/2014 - 19:55 | 4702289 Seer
Seer's picture

"fonestar sell you all out!"

Does that mean you, or does it mean we all depart?

Sun, 04/27/2014 - 15:16 | 4701493 Dick Buttkiss
Dick Buttkiss's picture

Just received this from PayPal, after completing the transaction yesterday:

"You asked us to transfer $XXX.00 USD from PayPal to your bank account, and we're processing it now. It usually takes 3-4 business days for transfers like this to go through, so you should see the money in your bank account by May 1, 2014."

Along with the interloper fees, the interloper "float" will also be history.

These alone are reason enough for the end of money & banking as we know it, to say nothing of the fact that the true potential of crypto-currencies hasn't even been glimpsed yet, much less achieved.

Sun, 04/27/2014 - 16:38 | 4701775 Ayr Rand
Ayr Rand's picture

When Bitcoin exchanges no longer require any dealings with banks (e.g., wire transfers into accounts), then the value of bitcoin may recover. Until then, the name of the game is "CAPITAL CONTROLS, BABY!" In other words, the central banks holds the reins. 

If any exchanges accept PayPal or credit cards, or anything else not involving a central bank, let me know. All wire transfers in the US are regulated by the Fed. 

Sun, 04/27/2014 - 17:59 | 4701993 fonestar
fonestar's picture

Capital controls are useless against the Bitcoin protocol.  Bitcoin's whole purpose is to evade capital controls.

Sun, 04/27/2014 - 18:12 | 4702036 DoChenRollingBearing
DoChenRollingBearing's picture

fonestar wrote:

"Bitcoin's whole purpose is to evade capital controls."

I would not know if that were the whole purpose, but as ZH-er "CrashisOptimistic" pointed out, that may wind up being its greatest purpose.  I can access my BTC in two ways now whenever I go to Peru.

Now I just have to find someone to accept it who has stuff I want there (gold maybe?), smile,,,


Sun, 04/27/2014 - 22:22 | 4702710 stacking12321
stacking12321's picture

ok, here's an exchange that is fully anonymous, and doesn't require a central bank:

www.localbitcoins.com

 

Mon, 04/28/2014 - 00:13 | 4702935 fonestar
fonestar's picture

Buy, sell and pump with fonestar on localbitcoins.com!

Mon, 04/28/2014 - 00:25 | 4702953 stacking12321
stacking12321's picture

no, not sell!

only buy, and then buy some more!

Sun, 04/27/2014 - 16:44 | 4701798 Seer
Seer's picture

"These alone are reason enough for the end of money & banking as we know it, to say nothing of the fact that the true potential of crypto-currencies hasn't even been glimpsed yet, much less achieved."

I'd had this conversation with a bunch of software engineers and scientists over 12 years ago.  We all got that "who farted?" sense when we realized that this was a strong possiblity- most of our funding was from a BIG bank!

It's all a two-part thing.  As an investment I wouldn't touch it.  As a transaction piece it has plenty of merit, though most of that would get watered down with various parties needing to provide traceability for backing out transactions.  As a blackmarket device it rocks, which is likely why it's doomed for acceptance in the mainstream (TPTB need full control of/over everything).

Sun, 04/27/2014 - 15:37 | 4701505 XenoFrog
XenoFrog's picture

Get in early on this stable alternative currency before it's too late!*

 

*Don't buy into get rich quick schemes that have already gone bust several times.

Sun, 04/27/2014 - 17:57 | 4701988 fonestar
fonestar's picture

It's the dollar that is not stable dumbass!

Bitcoin is the most stable, strong and awesome currency in mankind's history!

Sun, 04/27/2014 - 18:25 | 4702077 crash commando
crash commando's picture

Like stocks?

Sun, 04/27/2014 - 18:38 | 4702120 madtechnician
madtechnician's picture

Hey XenoFuck , what are you talking about there ? Cyprus bank accounts ?

Sun, 04/27/2014 - 18:06 | 4702018 fonestar
fonestar's picture

Don't listen to me, but at these prices btc is a buy. I am starting to accumulate and hoard.

That is absolutely correct hot sauce technician.  Bitcoin is a buy at any fiat price level because debt-based fiat is mathematically doomed.  BTW, interesting that you are a hot sauce technician because fonestar's PAL started off as a locust abortion technician before getting into network technicianing.

Sun, 04/27/2014 - 23:01 | 4702801 Dr. Everett V. Scott
Dr. Everett V. Scott's picture

BTC's central problem is their central missed opportunity: they should have provided for complete anonymity of Bitcoin transactions.

If Bitcoins could be used without showing who the users were ['washed'] then their popularity would skyrocket.  As it is, governments can trace each bitcoin. That allows the Chinese gov't and others to interfere; something they would be powerless to do with real and complete anonymity.

If a New Bitcoin [NBC] is ever constructed, the total anonymity of both spenders and receivers [buyers and sellers] must be guaranteed. Anonymity must be paramount. That will make government meddling irrelevant and impotent.  

Also, the NBC supply should be in the neighborhood of one billion New Bitcoins.  They should be easily divisible into centi-NBC's [one-hundredth of an NBC], mille-NBC's [1/1000th], micro-NBC's [1/1,000,000th], etc., to keep the NBC value from getting too high, making transactions clumsy and unweildy; exactly like a stock split.  That way, there will be plenty of NBC's to go around the world.  Taxes would be forced to revert to land taxes, like they were in the 1780's, because anything else could be picked up and moved out of governments' reach.

...just a couple suggestions, from someone who doesn't know much — but from someone who does know that anonymous transactions have immense value in today's world.  And even more, in the world of the future.

Sun, 04/27/2014 - 14:58 | 4701442 hot sauce technician
hot sauce technician's picture

Don't listen to me, but at these prices btc is a buy. I am starting to accumulate and hoard.

Ever done international transactions? You know how you get hammered by the banks? Exchange rates, fees etc? Enter btc. Cut out all third party interlopers. This concept is too incendiary for simple minds to fathom. It's simplicity almost makes it seem unrealistic. Just need faith to build, and ma and pa will one day be using this tech. The Kenyan and his ilk will be left in the dust with their cronies/masters.

Sun, 04/27/2014 - 16:58 | 4701831 Seer
Seer's picture

At best it's a transaction system for those still in the System.

"ma and pa will one day be using this tech."

There are 7+ billion humans on the planet.  Most don't have electricity, let alone Internet...  And for those that do you have to ask the question: does this give more or does it give less control for the likes of the NSA?

"Cut out all third party interlopers."

Is it the "interlopers" or is it the fees that are the issue here?

When debit cards first started appearing any theft or bad transactions were swallowed by the customer.  Later on the finanicial insitutions started swallowing all of it, and you can sure that there's a cost there, a cost, much like with the initial arrangement, WILL appear on the scene somewhere with crypto-currencies/cum-transaction mechanisms.

Despite what others here might think of my postion, I do believe that technology has a place, it's just that I don't believe it should ever get a free pass, and I also don't believe that it can solve every "problem" (especially given that we humans tend to improperly define problems to start with).

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