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With the deadline for the Chinese Bitcoin exchanges to be cut off from their bank accounts upon us as of today (Tuesday), the Bitcoin price is rising.
Wait, what?
As counterintuitive as it might seem, the CoinDesk Bitcoin Price Index is up about 10% today to about $500, although Bitcoin prices rose as high as $514.72.
At $500, the Bitcoin price is up a startling 40% from the low of $355 hit on Friday when several Chinese Bitcoin exchanges received notices from their banks that their accounts would be closed.
Even the Chinese are buying again, with the Bitcoin price in yuan up about 8.4% today to 3,125 yuan – up about 38% from its lows on Friday.
Bitcoin prices plunged last week on concerns that the People's Bank of China (PBOC) was quietly telling Chinese banks to sever ties with the exchanges by April 15 and that eventually it might even ban the digital currency.
But those fears were not realized.
For one thing, not every Bitcoin exchange has received a notice that its bank accounts would be closed, even though the deadline was today.
That includes the biggest Chinese exchange, BTC China.
"Our situation hasn't changed. We've been talking to banks, the ones we have personal relationships with, and so far we've not received any notice to close our business with them," BTC China Chief Executive Officer Bobby Lee told CoinDesk.
And just hours after the reports from the Chinese exchanges getting notices from their banks appeared Friday, the governor of the PBOC, Zhou Xiaochuan, made these surprising remarks at a regional economic conference:
"It is out of the question of banning Bitcoin as it is not started by central bank," Xiaochuan said. "Bitcoin is more a kind of tradable and collectible asset, such as stamps rather than a payment currency."
While not an official statement from the PBOC, the remarks eased the worst concerns about the central bank's intentions.
And it started the rally in the price of Bitcoin in both yuan and dollars that picked up even more steam today as several of the Chinese exchanges were able to continue doing business unhindered.
But with no official policy statements forthcoming, the events of the past several days still leaves a cloud of uncertainty hanging over Bitcoin in China.
Here's why that's probably not going to change for a while…
About the Author
David Zeiler, Associate Editor for Money Morning at Money Map Press, has been a journalist for more than 35 years, including 18 spent at The Baltimore Sun. He has worked as a writer, editor, and page designer at different times in his career. He's interviewed a number of well-known personalities - ranging from punk rock icon Joey Ramone to Apple Inc. co-founder Steve Wozniak.
Over the course of his journalistic career, Dave has covered many diverse subjects. Since arriving at Money Morning in 2011, he has focused primarily on technology. He's an expert on both Apple and cryptocurrencies. He started writing about Apple for The Sun in the mid-1990s, and had an Apple blog on The Sun's web site from 2007-2009. Dave's been writing about Bitcoin since 2011 - long before most people had even heard of it. He even mined it for a short time.
Dave has a BA in English and Mass Communications from Loyola University Maryland.
What we know is that the bitcoin is on rise to 6100,it may go higher than expected to 10000
My concern is how the governments will react. They can't kill or stop Bitcoin, but they could impede it and they could get in the way of its development.”