One month after China announced its crackdown on ICOs and cryptocurrency exchanges, the bitcoin price has made a full recovery from the resulting September crash. As of 4 PM EST on October 8, bitcoin has hit $4,600.
Bitcoin Price Shows Resilience Amid Potential Chinese Crackdown
Bitcoin returned to $4,500 this morning after a month of lows between $4,200 and $4,300. The price continued rising through the afternoon until press time, where bitcoin stands at $4,600.
September’s sustained lows came after the Chinese news on the 8th, which sent the markets into a panic. Two days after the initial crash, on the 10th, the price dipped again and hit a monthly low of $4,010.
For the rest of September, the markets held a sideways pattern, presumably in fear of further Chinese announcements.
However, Bitsonline’s official technical analysis remained bullish throughout the panic, maintaining its long-term projection of $9,000 by the end of 2017. Given the recovery seen in the first week of October, a year-end bull rally definitely seems possible.
But this doesn’t mean the threat of Chinese interference is gone. On the contrary, the country’s major bitcoin exchanges remain offline, and it’s likely China will elaborate on its plans for regulation during the 19th National Congress of the Communist Party on October 18.
In the meantime, trading volume on the peer-to-peer platform LocalBitcoins has exploded in China, and international attention has started to shift towards the approaching November hard fork.
Possibility of Another Contentious Hard Fork Poses Another Hurdle for Bitcoin
As part of the SegWit2X plan, the Bitcoin blockchain will hard fork on November 1 in order to implement a block size increase. While industry leaders signed off on this hard fork as part of the New York Agreement, community members, business leaders and influencers have started to rally against the block size increase.
Those against the 2X implementation want to see Bitcoin continue on without a block size increase, relying only on SegWit and its companion upgrades for scalability. With big block supporters in vehement opposition, the stage is set for yet another contentious hard fork come November.
In August, a contentious hard fork led to the birth of Bitcoin Cash, a version of Bitcoin with large block sizes and no SegWit. If the same thing happens with the next hard fork, we may set yet another version of Bitcoin: a SegWit2X coin to compete against a SegWit-only coin.
In the middle of this battle is the cryptocurency markets. The values of Bitcoin Cash, SegWit-only Bitcoin, and SegWit2X Bitcoin will all be subject to major fluctuations, with traders switching between the three coins as they try to decipher the drama and choose the most stable coin.
So, until the next bump in the road, all we can really do is sit back and enjoy the green candles while they last.
Do you think the November fork will significantly affect the markets? Share your thoughts in the comments below.
Image via Patuffel//Flickr