Bitcoin is a challenge to authority. China is not a big fan of such challenges. (Neither are most states)
China’s clampdown on cryptocurrencies has reportedly taken a new direction – to close down local bitcoin exchanges.
Initial reports from Chinese media that the government plans to close down domestic cryptocurrency exchanges have seen the virtual coin shed more than $100 since Friday. Bloomberg and the Wall Street Journal also reported Monday that that the country is planning to shut down digital currency exchanges.
Bitcoin sunk to a low of $4,241 in late trading in the U.K. Friday, and reached a low of $4,108 on Monday, according to Coindesk data.
It climbed to a record high of $5,000 dollars a little over a week ago, and has shot up by nearly 350 percent since the start of the year.
This is of concern but China’s efforts may serve as an excellent “stress test” for Bitcoin.