is this about as serious as the dwolla / mt gox severing?

[notig]

It seems to me that if the rumors are true china basically just wants more control over the money going into and out of bitcoin exchanges so they can keep track of things.

"I don't see how this would be such bad news. China is banning only 3rd party payment processors from bitcoin exchanges.
The situation is exacly the same as for trading gold and silver in China. Here is a quote from Chinese gold and silver regulation law "All gold and silver purchases shall be transacted through the People's Bank of China. No unit or individual shall purchase gold and silver unless authorised or entrusted to do so by the People's Bank of China."
So by banning 3rd party payment processors all the bitcoin exchange traffic is going through Chinese banks which are under the control of People's Bank of China. Chinese regulators are essentially treating bitcoin trading same as gold and silver."

[MAbtc]

The news itself is not so important. When buying pressure is exhausted, we look for reasons to crash the price. 

[gentlemand]

I suppose what is spooking people is that lots of Bitcoin trading in China was purely to move money abroad or out of the government's reach. That loophole has been closed.

I'm sure Bitcoin markets will continue there but it'll cool the market considerably. One of the main reasons for trading has suddenly become a lot harder.

It's far from an apocalyptic scenario. It's still not great news.

[Satyre_Noir]

The news itself is not so important. When buying pressure is exhausted, we look for reasons to crash the price. 

+1

[pand70]

It seems to me that china is saying something like "bitcoin is legal for people to trade between them if they can find a way to do it since we are banning every possible fiat payment processor to deal with bitcoins"

If the rumors are true China is officially the no.1 country against bitcoin right now.

[TheFootMan]

I suppose what is spooking people is that lots of Bitcoin trading in China was purely to move money abroad or out of the government's reach. That loophole has been closed.

Cash to btc, then move it wherever you want? You could even do it slowly, accumulating btc a little by little.

[gentlemand]

I presume it'll move more into a peer to peer type of deal like localbitcoins. The government is being a tad optimistic thinking the exchanges are where all the action will ever be. 

I dunno what the proportions are for their usage in other countries but I for one couldn't be arsed to wait to deposit to them myself. I think I obtained 5% of my coins via a formal exchange and that was such a grind I gave up.

[pand70]

I presume it'll move more into a peer to peer type of deal like localbitcoins. The government is being a tad optimistic thinking the exchanges are where all the action will ever be. 

I dunno what the proportions are for their usage in other countries but I for one couldn't be arsed to wait to deposit to them myself. I think I obtained 5% of my coins via a formal exchange and that was such a grind I gave up.

Localbitcoins is a good alternative but can't support the big market cap that bitcoin has right now.

[gentlemand]

True. Without large and efficient exchanges China will become a bit of a backwater in comparison to other countries. I get the feeling that's what the government is aiming for.

[jasonjm]

its pretty obvious this is very very bad. China is the reason for the price spike, and now it will be the reason for the crash.

the chinese obviously dont want citizens getting around exchange controls via bitcoin, and that is the end of the story. This will probably play out in other countries too down the line.

"The PBOC now explicitly requires that banks and payment companies  not provide payment and settlement services to Bitcoin, Litecoin and other peer-to-peer currency trading sites. For payment companies that have already done business with Bitcoin Exchanges, should end their business cooperation; withdrawals of balances should be completed before the Chinese Spring Festival (January 2014), and new payment services are not allowed."

basically all the chinese have until jan 30 to get their money out if they want their money out. Otherwise they are going to have to go cash only after that point for buying or selling.

So I would assume if you want to bottom pick, the time to buy in would be Feb 1st 2014, as my guess is there will be a steady stream of withdrawals until then.

[pand70]

So I would assume if you want to bottom pick, the time to buy in would be Feb 1st 2014, as my guess is there will be a steady stream of withdrawals until then.

The next huge crash will be an announcement from btcchina confirming the news