Déjà vu? Bitcoin Price Slips Below $900 Amid China News

(@mpmcsweeney) | Published on January 6, 2017 at 13:40 BST
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The price of bitcoin has declined more than 11% already today, a development that comes amid a week of high market volatility.

The movements are the latest in a week of trading that has seen the price of the digital currency nearing all-time highs before falling nearly $200 in a matter of hours and later recovering.

At press time, the price of bitcoin is averaging $899.00 across global exchanges, according to data from the CoinDesk Bitcoin Price Index (BPI).

The news also notably follows a decision by the People's Bank of China (PBoC), China's central bank, to publicly disclose that it had issued warnings to major exchanges in the country or otherwise discussed their practices within a legal context.

Representatives from BTCC, OKCoin and Huobi – marketplaces that account for the bulk of the world's bitcoin volumes, according to data from Bitcoinity – met with PBoC officials earlier this week.

CNY-denominated markets are down more than 9% from the day’s high. Average prices are currently ¥5,856.40, BPI data shows.

Observers have suggested that the price may remain depressed while the PBoC news is absorbed by the market, though they struck a largely bullish tone long term.

Déjà vu

That said, the story raises the specter of Chinese regulatory involvement in the bitcoin space, the threat of which sent bitcoin markets plunging in late 2013 after the Chinese central bank issued warnings to domestic financial institutions.

However, it remains uncertain whether the China news is directly correlated with the movements, as it was in 2013.

Bitcoin's price first began to slip today at around 8:00 UTC, when prices dropped nearly $30 in one hour.

News of the PBOC's actions, by comparison, don't seem to have impacted social media discussion until 11:00 UTC, when posts began appearing on the social media networks Twitter and Reddit.

Nonetheless, comments suggest that some may be using the news as a way to influence markets or otherwise gauge their short-term trading strategies given past precedent.

Image via Shutterstock

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