Bitcoin and other digital asset prices have bounced back slightly over the past 24 hours, as fears of a dramatic Chinese intervention subsided. Nerves have been on edge for the past couple of days, as BTC hovered around the psychological $4,000 USD mark.
At press time, bitcoin was $4,111 on CoinMarketCap. That’s up from the low point of $3,985 on 10th September. Other assets were also up slightly, though market caps overall remain battered by two big dumps since the start of the month. Price charts for most major traded currencies showed a similar pattern, indicating movements weren’t due to technical issues with individual assets.
Ethereum (ETH) is up 5.04 percent at $289. Litecoin is up 8.25 percent to $64.46, and Ripple XRP gained 6.42 percent to $0.214. DASH, Monero, Bitcoin Cash and Ethereum Classic also rose.
Still Not Back to Pre-Dump Levels
The gains are a slight buffer against disaster, but aren’t spectacular or even a return to pre-dump levels. There’s also no guarantee things still won’t suddenly head south. Of course, anyone who’s traded cryptos for longer than a few month already knows that by now… right?
One thing that is almost guaranteed in this industry, though, is this: regulatory bad news out of China will tank the price. It’s been happening since 2013 at least, following an almost reliable pattern. After an initially dramatic statement saying Chinese regulators might shutter major exchanges (listed by name), the news has re-entered limbo land.
Spoke to well-connected contacts in China. The latest rumors are just that. May affect small and unregulated players. But thats it !!
— ⚡ George Kikvadze ⚡🇧🇷 (@BitfuryGeorge) September 10, 2017
There was no immediate move to halt trading or business activity. The exchanges also claim they haven’t received any notice from the People’s Bank. They pointed out that bitcoin and other assets remain legal.
The Chinese Pattern
But then, that’s exactly how things went three years ago as well. At first, the exchanges didn’t hear anything. Then a few weeks later they were putting out collective statements disavowing risky activity, and withdrawing from conferences. Then things quietly went back to “normal” — whatever that is.
The pattern repeated again at the end of 2016 — Chinese authorities announced they would investigate exchanges, and they stopped withdrawals for a while. Again, the price tanked for a short while.
Claims of “FUD” and “hoax” have flown around in the wake of the latest Chinese rumors. Will ICO organizers really have to return all funds raised? Are your balances safe on Chinese exchanges?
The fact is, no-one really knows all the details yet, and governments’ long-term plans for cryptocurrencies are never certain. That’s true everywhere, not just China. Sometimes announcements are deliberately vague, or designed to test reactions, or intended as a caution.
Could We See More OTC Trading?
There was one interesting point this time — the specific mention of OTC (over-the-counter) trading.
Bloomberg: Chinese authorities "don’t have plans to stop over-the-counter transactions" If that's true, it'll be retail out, the 1% in. https://t.co/b2tUyERvlo
— Tuur Demeester (@TuurDemeester) September 11, 2017
That’s possible, but it could also push regular folk towards new platforms as well. A few consumer-grade OTC apps have already appeared. They’re nowhere near ready to replace busy exchanges yet, but they could be a sign of the way cryptocurrencies will trade in the future.
What do you think will happen to cryptocurrency market caps next? Let’s hear your thoughts.
Images via Pixabay