Bitcoin's Outlook In China Is Not Looking So Good Anymore
Bishop is confirming this evening an earlier report from Coindesk.com's Emily Spaven that the People's Bank of China has issued a new ban on third-party payment processors from doing business with Bitcoin exchanges.
It's a sign, he Tweeted, that China is "now cracking down harder" not just on Bitcoin but most other digital currencies, including Litecoin. "PBOC does not like it, does not want it to become another speculative bubble here. tough to fight the PBOC," Bishop said.
Bitcoin prices on the yuan-traded BTC China exchange are down 34% on the news, and prices on the USD-traded Mt. Gox exchange have been flirting with crossing below $700 for the past hour or so. Mt. Gox prices are off 16% on the day.
The latest ban is a a separate regulation from the People's Bank of China's Dec. 5 ruling barring formal financial institutions from processing Bitcoin. Rui Ma, a China-based angel investor, commented that if the crackdown continues, Chinese may only be able to purchase Bitcoins via miners or other traders.
Hardcore Bitcoin evangelists maintain that these are all expected bumps in the road. But restricting commerce in China would be a huge blow - it was Chinese demand, after all, that helped Bitcoin prices more than triple in the past few months.