China dictating prices

[icqcointokenwallet]

Many regulations will get pushed this year dealing with digital crypto currencies.  The only way governments can control it right now is, limit the fiat you spend on bitcoin and others.  Or simply just outlaw the use of bitcoin and others.

[metalbean]

If the Chinese really are using Bitcoin to get money out of the country, could that not explain the wild swings that have been happening in the last few days?

I imagine that some buys a few million USD worth of Bitcoin on a Chinese exchange. They then transfer them to a US or European exchange, and cash out to a USD or Euro denominated bank account.  That would move the market sharply in both directions.

If the Chinese really are getting money out of China using Bitcoin, they can't be holding the Bitcoin, as the market cap isn't high enough, so they must be selling too.

You are right on both counts.

To further elaborate

1. Chinese has been getting money out of the country for a long time You see, the average Chinese have strong faith in USD, but the swing has been exacerbated because the authorities had a coffee session with the three major exchanges. And this is a sign of tightening bitcoins control, hence the selloff.

2. You are right, 12 million bitcoin is worth 12 billion USD not including lost coins which some says is >50%. So that's only 5 billion which pales in comparison with 3 trillion USD FX reserces they have (I know it's apple and oranges). So they can't be only holding bitcoin, many are selling and buying and selling. Classic demand and supply

[metalbean]

Yes it is true that bitcoin has been a way for chinese people to place their money out of China. And that is why the government of China has placed a regulation placing a limit from 50,000$ down to 10,000$ annually,a limit amount on which the CHinese can send outside their country. If Chinese government had not placed a limit then possibly Chinese people will continue to purchase bitcoin then it will lead to economic crisis and collapse of currency. It will be good for bitcoin if they continue buying since it has greatly increased  in price but it will be bad for their economy.

Due to  money laundering cases soon China will leave Chinese Yuan and will replace it with fiat digital currency.

Interesting. I haven't heard about the new cap. Is it already in place or it's scheduled for mid year which is the time when they impose a new sets of rules irt money transfer.