Bitcoin Plummets in China Amid Ban
Central bank: It's not a real currency
By Matt Cantor, Newser User
Posted Dec 18, 2013 10:37 AM CST
In this April 3, 2013 file photo, a man rolls a stack of bitcoin tokens at his shop in Sandy, Utah.   (AP Photo/Rick Bowmer)

(Newser) – On Monday, China's central bank told top Chinese payment-processing firms they could no longer deal in digital currencies; two days later, the country's top Bitcoin exchange, BTC China, has now had to stop taking deposits in China's currency, the renminbi. Now, the value of bitcoin in the country—one of the biggest markets for the digital currency—has plummeted, the New York Times reports. As of this evening in China, BTC put Bitcoin's value at some $380 each, or 2,300 renminbi, down 40% from yesterday.

The figure is also less than half of Bitcoin's peak value of 7,395 renminbi, hit Dec. 1. The People's Bank of China, along with four other official finance and tech agencies, declared a ban on Bitcoin deals on Dec. 5, in order to "safeguard the interests and property rights of the public, protect the legal standing of the renminbi, take precautions against the risk of money laundering, and maintain financial stability." The central bank says Bitcoin isn't a currency. "It is not issued by a central monetary authority, it does not have the properties of legal currency, and it is not a currency in the real meaning of the word." Meanwhile, in North America, Bitcoin is involved in some big purchases.

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Showing 3 of 36 comments
K.KRANK
Dec 19, 2013 2:53 PM CST
Anti Central Banking Libertarian nonsense: Why Charles Stross Wants Bitcoin To Die In a Fire http://politics.slashdot.org/story/13/12/19/1332237/why-charles-stross-wants-bitcoin-to-die-in-a-fire
K.KRANK
Dec 18, 2013 8:48 PM CST
The Chinese have a very valid point. Currency has always been tangible, i.e., physical. Someone using high-power computers to crunch an algorithm to arrive at a solution to what is essentially a complicated math problem is the opposite of tangible currency. I would not expect my bank to allow me to walk in with a bitcoin math problem solution on a USB drive & tell them, give me today's exchange rate for this coin, $600 for this thumbdrive with the bitcoin math solution on it & expect them to do it. In fact, I'd expect them to look at me like I was crazy instead. I can solve SETI@home data on my computer & put those results on a USB drive & drive them over to SETI's HQ & ask them if they're worth anything, which is dumb, because the data you download to run SETI@home & the results your computer derives from crunching the data packets is all volunteered. Plus, what value is there in running Fast Fourier Transform analysis on radio telescope data collected from the skies? (especially if all the FFT crunching yields on the radio telescope captures is a bunch of noise hahaha http://setiathome.berkeley.edu/sah_glossary/fft.php)
ChopperPilot
Dec 18, 2013 2:57 PM CST
The claim that it isn't a currency is just absurd. By definition it IS a currency. Oh well, I suppose Chinese people that want some bitcoins will just have to get them outside China