It was only a matter of time before traders decided to take profits and sell while the price was high. After a 6% jump last night as Bitcoin’s ETF decision date is approaching, the bears have made their presence known with the recent selloffs.
When an unexpected price action happens, it is only natural to look for ideas and theories that would explain the market reaction. Currently, one theory for the dropping price is another PBOC meeting.
According to a Chinese finance blog, the PBOC will be holding a closed-door meeting discussing possible actions to improve AML / KYC regulations on Chinese exchanges. Since China has always been the leader when it comes to dictating market action, some speculate the regulators are once again the cause for the drop.
It seems that the regulators want to make sure no money will be moved out of the country with the help of Bitcoin and Bitcoin exchanges. By eliminating the possible on-ramps for anonymous currency exchange the government hopes to make it harder than ever to transfer money out of the country.
— The Merkle (@themerklenews) February 8, 2017
By placing all these rigorous rules on Bitcoin exchanges and possibly forcing them to implement over the top KYC protocols, many exchanges won’t be able to stay afloat. As the customer base will dwindle down since most Bitcoin users always prefer to stay as anonymous as possible, only the few top Bitcoin exchanges will stay in business. This will make it easier for regulators to have tighter control over the Bitcoin exchanges in their country effectively feeling somewhat in control of Bitcoin.
While it seems that quite a bit of traders have been wanting Bitcoin to go down, the overall dip isn’t that significant. Considering the price earlier this month was $930, a $40 dip after a $130 rise isn’t bad at all.
Most traders agree that the long term market trend is in fact bullish, so if you are a holder grab some popcorn, sit back, and enjoy the show. The PBOC will continue to issue Bitcoin warnings, hold secret meetings, and spread FUD about the cryptocurrency. However, Bitcoin has an 8 year track record of being resilient to all types of attacks, state-sponsored or not.
If you liked this article, follow us on Twitter @themerklenews and make sure to subscribe to our newsletter to receive the latest bitcoin, cryptocurrency, and technology news.