China Cryptocurrency Exchange Crackdown causes bitcoin price dip.
You would recall that the price of Bitcoin rose to above $4700 and was heading to the $5000 mark. Holders were enthusiastic they would soon reap more gains from selling their highly cherished assets. But just one wrong step from the Chinese government tumbled everything and suddenly the price plummeted below $3800.
No one saw this coming; not even the experts! Precisely, on September 1st 2017, the price of Bitcoin rose to an all-time-high of $4,904.9 and nerves were on edge. Investors were anxious about what could happen next. Some were already counting their gains in advance. Then the unexpected happened.
Chinese Governments Threw The First Punch
The problem of Bitcoin started when the Chinese government launched a crackdown on exchanges. The government has decided to ban Initial Coin Offerings (ICOs) in the country. Being the world’s second largest economy, China’s attack on Bitcoin took a lot of wind out of Bitcoin.
This development simply means that the cryptocurrency would no longer make much impact in Asia, a continent that has largely played a role in taking Bitcoin to where it is today. The PBOC has already prepared a draft that would prevent bitcoin trading from being offered on the Chinese platforms.
JP Morgan Delivers The Final Blow
While the cryptocurrency was still reacting negatively to the Chinese government’s crackdown on exchanges, the final deadly punch against Bitcoin was delivered by the highly respected JP Morgan boss Jamie Dimon, who criticized and called the cryptocurrency a ‘fraud’ that will ultimately blow up. He went further to say that he would fire anyone trading Bitcoin, declaring that it was against their rule and ‘stupid’.
It was the last straw that broke the camel’s back.
Trust investors! The utterance came from an insider in the financial market and as an authority source, his personal opinion was taken serious and before you knew it, the price of Bitcoin began a downward spiral.
These double assaults on Bitcoin have led to it losing up to $1000 since September 1st 2017. However, the developments have been eliciting reactions from stakeholders in the industry.
John McAfee, of MGT Capital Investments, has dismissed Jamie Dimon’s claim that the Bitcoin was a fraud. According to him, “You called Bitcoin a fraud. I’m a bitcoin miner. We create bitcoins. It costs over $1,000 per coin to create a bitcoin.
“What does it cost to create a US dollar? Which one is the fraud? Because it costs whatever the paper costs, but it costs me and other miners over $1,000 per coin.
“It's called proof of work."
He’s not the only one who has reacted to the issue.
Chris Skinner, global ambassador for London-based fintech trade body Innovate Finance, simply saw the attack from Jamie Dimon on bitcoin as “naive”.
Charles Hayter, the CEO and cofounder of CryptoCompare, also spoke with Business Insider. In his opinion, “Jamie Dimon doesn't have the strongest track record when it comes to looking over the hill and generally you can't teach old dog new tricks,"
As more and more reactions keep coming, is Bitcoin likely to recover and move ahead or is this the beginning of the end of the cryptocurrency? Lets talk about this in the comments.