Bitcoin is shrugging off some big news of out of China
Monday's flat session comes despite some big news out of China. According to Reuters, the country's three largest bitcoin exchanges announced they will begin charging a flat fee of 0.2% per transaction. Releases from BTCC, Huobi and OkCoin state that the fees are being implemented to "further curb market manipulation and extreme volatility."
Bitcoin has had a wild start to 2017. The cryptocurrency rallied more than 20% in the opening days of 2017 amid huge interest from China, which accounts for nearly 100% of trading. In fact, data from Cryptocompare found, "In the first 24 hours of the new year, over 5 million bitcoins were bought in Chinese yuan, equating to $3.8 billion. In contrast, just 53,000 bitcoins were bought in US dollars."
However, the early gains vanished in a matter of days as bitcoin tumbled 35% on concerns China was going to crackdown on trading. Beijing announced it had begun investigating bitcoin exchanges in Beijing and Shanghai on suspicion of market manipulation, money laundering, unauthorized financing, and other issues.
But bitcoin has managed to work its way off support in the $750 area, and is trying to break out of resistance in the $880/$920 area that has defined trade for the past week.
Monday's announcement will hopefully take some of the volatility out of the market as bitcoin traders in China won't be allowed to buy and sell as much as they want without paying the new transaction fee.
