Bitcoin price plummeted to a monthly low as rumors that the People’s Bank of China (PBoC) was planning to crack down on bitcoin exchanges began to receive apparent confirmation.
Bitcoin Price Plunges on China News
BTCC announced its exchange will suspend trading on September 30, and although the closure appears to be voluntary, a Shanghai media service reports that the city issued verbal shutdown orders to local exchanges. Moreover, a financial service that sits on a PBoC-established self-regulatory agency claimed in a newsletter that regulators have said a bitcoin exchange ban is “certain”. Charlie Lee–brother of BTCC CEO Bobby Lee–stated on Twitter that Chinese exchanges OKCoin and Huobi will meet with regulators on Friday, presumably to discuss whether or not they will be allowed to continue to operate within the country. Finally, ViaBTC also confirmed it would cease trading operations on September 30.
This tumultuous environment translated into market volatility, and the bitcoin price plunged as much as $750 from its previous-day level. At the time of writing, bitcoin was trading at $3,364 on Bitfinex–about $30 above the global average.
Bitcoin Price Forecast
This rapid movement has left investors wondering how best to play the market. Should one buy the dip now, sell and re-establish a position if the market continues to decline, or just “hodl”? Many industry crypto industry leaders and observers have weighed in on this question on Twitter.
Prominent trader WhalePanda argued that the bitcoin exchange ban had already been priced into the market over the course of the past week, so he is taking the opportunity to buy low ahead of the eventual recovery. He stated that most of his buy orders are placed at $3,200.
Economist and researcher Tuur Demeester stated that he began buying the dip at about $3,400. Noting that the bitcoin price had declined 33% in less than two weeks, he calculated that there is a fair chance it will rebound soon.
Others anticipate the correction will track more closely to Goldman Sachs chief technical analyst Sheba Jafari’s recent analysis, which forecasts a crash down to the mid-to-low $2,000’s. Civic CEO Vinny Lingham, for instance, stated that he would not consider buying until the price reached $2,500 to $2,700. Significantly, he advised selling above the $3,700 level. BitPay co-founder Tony Gallippi agreed, stating that he sees support levels at $3,000 and $2,600.
Chainstone Labs CEO Bruce Fenton did not. “I’ve got two words for my old friend Vinny,” he wrote. “HODL. Yes, that counts as two words, because some people don’t hear it the first time.”
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Last modified: March 4, 2021 4:59 PM