Original link:http://www.bitell.com/t/2044
Around 18:30(Beijing time), Mar.21st, when most of the Chinese bitcoiners were on the way back home from office or having pre-weekend cheerful dinner with girlfriend or family, Bitcoin and Litecoin prices had fluctuated over 30% in shortly a few minutes.
Okcoin and Huobi, are two biggest exchanges in China, here is the K-line graph from Okcoin at the time, bitcoin price dropped from 3700Yuan to 2653Yuan in a short time:
Another K-line graph from Huobi at the time, Litecoin price dropped from 94Yuan to unbelievable 1Yuan:
What happened?
It all started from a Weibo(like Twitter) message with the ID name’Cai Tong She’. It posted that China's central bank had issued a document on March 18, asking all Bitcoin transactions to cease by April 15. This Weibo with breaking news had been forwarded by Sina financial report almost immediately without confirmation. Sina is one of the biggest news media in China with an enormous number of readers. So the news spread out rapidly like a bomb. It shocked and upset many investors. Followed with big amount of bitcoins and Litecoins selling. Hence price dropped sharply. After about 1 hour, price gradually went up and got stable at around 3500Yuan for bitcoin and 97 Yuan for Litecoin.
That news on Sina live feed news page had been edited once with vaguer tone and then deleted right after the price-dump incident.
Updates until now, it turned out the news was false, just a rumour, likely to be scaremongering. The truth is Chinese government has never banned Bitcoin. There have been reports today that the central bank has issued a document to media platforms suspending bitcoin transactions. A source close to the regulators told Sina Finance that the central bank had issued a document, but not halting bitcoin, instead strengthening the regulation of bitcoin.
So was Cai Tong She or Sina the manipulator behind the scene? Was it a plot made by some big evil whales with attempt at market manipulation perhaps to buy coins cheaper? Victims who sold their coins so cheap with a total loss up to 10 million Yuan. Huobi offered risk compensation for those who were mandatory liquidated, while Okcoin sponsored for legal cost for bitcoiners to search for and sue the source.
Last december a rumor came out about bitcoin being regulated in China with a price drop, it turned out to be true. Once bitten, twice shy. No wonder this time a rumored false message had such a killing power. A clean and healthy Bitcoin environment with certain regulations is strongly called upon.
