Bitcoin Crashes 35% In China: Beijing To Shut All Local Exchanges By End Of September

Tyler Durden's picture

Update: Confirming the other speculation, that China would halt all cryptocurrency exchange, Yicai reports that it is not just BTC China: 

  • CHINA MAY SHUT ALL LOCAL BITCOIN EXCHANGES BY SEPT. END: YICAI

To which the response from the Bitcoin Association of Hong Kong is: "if China restricts growth in bitcoin" it will drive business to us"

* * *

Yuan-denominated Bitcoin has crashed as much as 25% 35% in Chinese trading, plunging from 25,000 yuan to as a low of 16,000 on local exchanges BTCChina (and as low as 20,000 on OKCoin), following confirmation of last week's Caixin report that Beijing would stop cryptocurrency exchange trading. China's second largest exchange, BTC China, said that it would halt all trading on the platform beginning September 30, launching a liquidation panic.

In a statement released on Weibo, BTC China said that it would immediately stops accepting new account registrations on BTCChina Exchange. The decision was made after “carefully considering” Chinese regulatory bodies’ Sept. 4 announcement on preventing risks associated with token fundraising. A google-translated version of the statement:

China will stop all trading business on September 30th

 

Dear Bitcoal Chinese users: According to the September 4 issue of the "People's Bank of China Central Office of the Ministry of Industry and Information Technology Ministry of Industry and Commerce, China Banking Regulatory Commission, China Securities Regulatory Commission on the prevention and treatment of the risk of the issuance of the currency," the spirit of the document, adhering to the protection of investment risks, the maximum protection of users

 

The principle of interest, Bit Coin Chinese team by careful discussion, is to make the following decision:

 

1. Bit currency China's digital asset trading platform today to stop the registration of new users;

 

2. September 30, 2017 Digital asset trading platform will stop all trading business.

 

Beitou China's pool (pool) and other business will not be affected, continue to normal operation.

We apologize for the inconvenience. If you have any questions, please contact support@btcchina.com.

And on Twitter:

The immediate result was a sharp plunge in the CNY-denominated price of bitcoin on exchanges like BTC China and OKCoin:

While China no longer dominates cryptocurrency trading - it accounted for nearly 90% of all trading in late 2016 before Beijing launched a series of measures to limit participaton - and is now responsible for less than 40% of global volumes, the Chinese selloff has spooked global markets, pushing bitcoin sharply lower on international exchanges as well like Coinbase, where it was trading at approximately $3,600 last. 

A breakdown of global bitcoin exchanges by volume is shown below:

Also notable: as of this moment, China-denominated bitcoin is trading at about 17,000 yuan or just under US$2,500, indicating there is a nearly 30% arb between Chinese and offshore trading.

This isn’t the first time the bitcoin market in China has come under regulatory scrutiny. In early February, major exchanges suspended withdrawals of bitcoin and stepped up their scrutiny of clients after meeting with the central bank.

Emil Chan, vice-president of the Hong Kong Blockchain Society, said it would be difficult for regulators to outlaw bitcoin trading altogether. “There is no option to restrict cross-border sales of bitcoin. It is a smarter move to maintain the operation of the local exchanges if the central bank’s goal is to minimise the outflow of yuan.”

Still, the virtual currency is up more than six times from a year ago, with some participants convinced the bitcoin market is in a bubble. “In fact, the market was too hot. The action taken is an effective action to cool down the global cryptocurrency market,” said Chan.

Meanwhile, Leonhard Weese, president of the Bitcoin Association of Hong Kong, said if China continues to toughen up on regulations to restrict growth in bitcoin, it may drive the business to the city.

“People in China will be more careful about marketing these events, and a lot of that marketing activity will come to Hong Kong in the form of conferences and communities,” said Weese.

It remains to be seen if Chinese bitcoin fans will simply switch to other OTC/bilateral forms of trading, or simply take their trading to neighboring Japan and South Korea which remain eager advocates of trading in the crypto space.

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Mr 9x19's picture

i forgot this one. calling for john, john, allo, john,

nmewn's picture

That's the funny thing about ponzi's  ;-)

aurum4040's picture

Lol, over. The sell off is over that's about it. The big boys are getting in, they cleared every weak hand out and are building their position. Most banks missed the move in BTC over the years. You actually think Dimon isn't loading up with each down move? Come on, when have you heard a CEO of one of the biggest banks in the world makes comments like this on a tradeable instrument? Never. If he thought it was a scam, he'd be short and communicate such. 

BarkingCat's picture

He would be short?

Is there even a way to short bitcoin?

any_mouse's picture

How to short bitcoin.

1. borrow bitcoin from someone willing to lend.

2. sell bitcoin at current price. On the open market.

3. bitcoin drops in value (fingers crossed)

4. pay back with lower value bitcoin plus interest. Buy on open market and then exchange to lender for the note.

Next Topic: Future Contracts for Bitcoin.

One should not invest in any currency, unless one understands currency markets and how they facilitate International Commerce.

tmosley's picture

Of course. You can short bitcoin on multiple exchanges.

Bentaros's picture

It was back in 2013 when I was part of the big drop from like 1300$ to 100$ within a very short period of time...I did not sell, I bought more. A slingshot has to drop back to gain force and reach the moon. It's not over, it just begun.

any_mouse's picture

A slingshot that can reach the moon. Good metaphor.

Bentaros's picture

go suck your mother and then come comment on my metaphors.

I am a Man I am Forty's picture

Bought Ethereum at $240 this morning

Raffie's picture

Nice.. ETH to be over $1k in the next year. 

I bought ETH when it was $18 but only got 50. Lessons learned for sure. LOL

Banjopicker's picture

That very drop was also due to China's influence on the market.  Anyone who lived through that and now sees it happening again isn't freaking out so much....

charlewar's picture

can't be over...I've tulip bulbs to trade for bitcoin...

Justin Case's picture

As it was posted here many times, the Gov't will do something about losing control of money. Thinking that Gov't cannot do anything to stop crypto currencies is being naive. They will take control of anything that impairs their control over the sheeple. They won't quit until they control it. Period. Getting out is the trick. Once the exchanges are shut down, where do you get yoar bitcoins converted to fiat?

If the "value" of gold or bitcoin is not measured in government fiat, but in their own potential as monetary instruments? After all, the US dollar will not outlast the US government (in its current form, at any rate), but gold will and bitcoin might. And if these instruments are not investments but hedges, that changes the meaning of their "value," doesn't it?

 

GodSpeed_00's picture

You morons never learn do you? Bitcoin will be back to new highs eventually.

Raffie's picture

Shhhhhh let them celebrate thinking cryptos are going down to zero. 

Its all they got to make them feel their hate and lies are paying off.

They act like total fools...

tmosley's picture

You can talk as much sense as you like to them. It won't make any difference. That's why they are peanutz.

mtl4's picture

Aw damn, this just got real.

c2nnib2l's picture

this is going to hurt !

imagine BTC was 5 K just a week ago

it's 3.5 K now and still goind down.. poor people

fredquimby's picture

I bought at $47 so we good. Poor. haha. 

Justin Case's picture

It's a lesson. It's not like nobody warned these people. As I said, those that are in the bubble, are the ones that fail to see it.

ET's picture

Yes.

Mania and madness of the crowds had reached fever pitch when Whoppercoin came out and Paris Hilton was pumping her ICO. The crypto community was also attracting the state lottery players while the big players were cashing out and trying to buy homes in the UK with bitcoin.

The closing of the Chinese crypto exchanges will slam the crypto door shut for money moving out of the country. The US will also follow the Chinese move. The CEO of JP Morgan lambasting crypto was a huge warning. What the six big US banks want done, you can be sure that the Fed and the Treasury want done, too. Capital controls and restricting trade with North Korea are some of the reasons why this is happening.

algol_dog's picture

Saw 1000 bitcoin bid @3720 this morning get eaten up in a couple minutes. Down about $100,000  now.

Bank_sters's picture

Callling Tmosely.   Calling fonestar.   HELLO?  Anyone?

 

Infinite QE's picture

They're out trying to figure out how to sell. 40 lane highway to buy, 1/8th of a lane to sell. Getting a little crowded.

 

BlindMonkey's picture

You know what to do.

 

BTFD

shizzledizzle's picture

I think we should all chip in and send Tmosely a case of monistat 7 as he will surely be suffering from some swelling today. As for fonestar I hope he had the sense to take profits, sadly I think he was pretty "buy and hold" for eternity.  

tmosley's picture

You morons are dancing in the streets and my prediction of a gap fill to $3000 hasn't even come true yet.

Why are you so stupid? This is normal for Bitcoin. Idiot bureaucracies are fucking over their own people hard, but cryptos will be just fine.

Bill of Rights's picture

STFU fan boy your shtick is getting old

Shift For Brains's picture

You didn't  ask for my opinion but I thought I'd stick it in anyway.

Why should anyone here begrudge crytocurrency profits? There is nothing an individual could do with that money that the top echelons of the US government don't do every day...and a whole lot worse.

Personally, I hope tmosley backed up the truck when BTC was $1 and he's sitting on a freaking fortune. I took chances and made my money in leveraged silver, why should I take pleasure in trading losses for another asset that an individual holds?

We keep forgetting the people we should save the Two Minute Hate for. It's not guys who happen to have done well on an investment without any insider information.

Justin Case's picture

This is not an instrument that people like to put money into. There is too much controversy and volatility for it to be credible and it's future to survive. Like investing in the roulette wheel. No TKS kids.

It's apparent the majority of posters feel the same.

Best of luck to the risk takers.

tmosley's picture

Always good to default to the safety of the herd. 

quadraspleen's picture

did someone say arbitrage?

Deep In Vocal Euphoria's picture

Mcafee: bitcoin to 500k 

 

ROFL!!!!!!!!!!!!!!!!

The central planners's picture

Mcafee is picking the right souce that best mix with his cock flavour.

tmosley's picture

You do realize that BTC is significantly higher than it was when he made that prediction, right?

Of course you don't. You don't realize anything.

The central planners's picture

Seems like someone is BUTTHURT!!

tmosley's picture

Yeah, the peanut gallery.

If the SGE was closing, gold would be down into the low hundreds. But all the Chinese BTC exchanges shut down and the US price barely falls 15%.

The central planners's picture

Closing the SGE means the Chineese killing its global hegemony aspiration. So if you really think thats happenning then youre nutz.

tmosley's picture

You are unable to comprehend basic argumentation.

Those aspirations are gone. Gold is going no-where. Crypto is the only living money left, and they just forced their people out of it. They will buy back in when it is an order of magnitude higher, and China will never again reclaim the crown of crypto hegemon. That title will be fought over by South Korea and Japan. Maybe the US can catch up too. Who knows? Anyone's game now.

Wrenching Away's picture

And this is supposed to be a community of traders? LOL. You guys have the most amazing trading opportunity in years with btc, and all everyone here does is moan about it being a scam.

BarkingCat's picture

It is a scam.

A Two Bit Con.

tmosley's picture

Who is scamming who? Satoshi builds the system, and stands to become the richest man who EVER lived if BTC was adopted as the world reserve currency (implying a price ~4000x higher than today's). But somehow he doesn't want that for no reason?

Use that brain the God gave you, as atrophied as you have allowed it to become. EVERYONE benefits from BTC adoption, except stubborn oldbugs and covetous Jews who can't freely steal money through debasement any more. Those big in the sector all the more.

China just gave up the opportunity of a lifetime. They controlled most of the world's bitcoin. If they had moved to a crypto standard, they would rule the world, even moreso than they would on a gold standard. But they threw it all away because they are stupid communists.