In spectacular fashion, a Bitcoin crash has taken place, falling over 25% in U.S.dollar (USD) terms and over 30% versus the Chinese offshore yuan (CNH) on Monday, before recovering off of the lows.Analysts are quick to blame profit-taking as a primary catalyst for the Bitcoin crash, with exchange watchers noting that selling pressure was solidly building below Bitcoin’s previous high of $1,165.89 on November 30, 2013.At noon EST on Monday, the leading cryptocurrency was trading at $891.82, down over 23% from the 2013 high.Certainly, Bitcoin was due for a sharp pullback after increasing in value almost unobstructedly since its late 2015 breakout from the low-$200.00 range.Unsurprisingly, this move coincided with the Chinese offshore yuan devaluing over 11% during that stretch, while a near-record $207.0 billion flowed out of China during the third quarter of 2016.The strength of the USD is not making the Chinese outflow situation any better, and the expected U.S.interest rate hikes in 2017 are expected to keep pressuring the yuan.

(Source: “Barclays: China capital outflows at ‘near-record’ levels,” Europe Breaking News, December 2, 2016.)For Bitcoin investors, the price action is eerily similar to events seen three years ago.Back then, as Bitcoin was undertaking a spectacular ascent, smashing through new highs and briefly coming to parity with gold, a dramatic sell-off occurred.ethereal credit farming wowAfter touching an all-time high of $1,165.89, Bitcoin proceeded to shed 27% of its intraday value between November 30 and December 1, 2013.ethereum jobs singaporeThis was just a foreshadowing of the sell-off to come.pb mining bitcoinAfter a brief rally, which saw prices retest the high, the selling resumed.cara dapet bitcoin gratis

Coinciding with a People’s Bank of China (PBoC) crackdown on commercial banks dealing in Bitcoin, in a three-day period between December 4-7, 2013, Bitcoin’s value more than halved from the mid-$1,100s to the mid-$500s.It was a spectacular descent, which led many critics to proclaim the death of Bitcoin as a true, stable store of value.bitcoin utopiaWhat happens next is anyone’s guess.bitcoin al alzaOn the one hand, augmented per-minute trading volumes across all major exchanges, combined with a gradual reduction in price volatility and adoption metrics, suggest that Bitcoin may see enhanced price stabilization—and perhaps an increase to new highs—this time around.bitcoin upside potential(Source: “Bitcoin Freefall: Prices Drop Nearly $200 in 1 Hour,” Coindesk, January 7, 2017.)ethereum understanding

However, if the Chinese government moves to restrict Bitcoin exchanges from moving cryptocurrency to platforms outside China and to impose hard quotas—like they have already done on yuan exchanges—this could exert sustained heavy selling to the downside.litecoin mining cloudIt’s a case of “buyer beware” at the moment.(Source: “China’s new rules on cash transactions not capital control: expert,” ChinaDaily, January 3, 2017.)In light of the Bitcoin crash, most investors may elect to take a wait-and-see approach with the world’s most-adopted cryptocurrency.All eyes will be fixated on whether the Chinese government chooses to extend capital controls to Bitcoin exchanges in response to yuan devaluation versus the U.S.Considering that Chinese buying makes up a predominant portion of trading volumes, the decision whether to laissez-faire or not is a critical one.by Tyler Durden Just yesterday we noted the resurgence in Bitcoin as China turmoil accelerates, but overnight (as Yuan weakened further), demand for the cryptocurrency has soared once again, sending the price (in USD) to $875 - the highest since Dec 2013.

Bitcoin is up over 10% this week alone.Bitcoin is soaring...We first warned of this 'outlet' for Chinese capital in September 2015 when Bitcoin was trading around $200...now it is trading at $875 And the massive volume coming from Chinese exchanges suggests where the flow is...The last 48 hours have seen Chinese Bitcoin prices spike over 12% on heavy volume...As a reminder, back in 2013, the government classified bitcoin as a commodity and not currency, placing it outside the purview of the foreign-exchange regulator, the people said.That does not mean, however, that China is powerless at limiting bitcoin's upside.Several Chinese government bodies including the People’s Bank of China and the financial regulators said in a joint notice that year that bitcoin functioned like a digital commodity without the legal status of a currency.The central bank said in January it is studying the prospects of issuing its own digital currency and aims to roll out a product as soon as possible.While China dominates bitcoin mining and trading, the government has shown caution over its spread in the nation.

In 2013, the PBOC barred financial institutions from handling bitcoin transactions.Bitcoin has had a very volatile trading history since it was first created in 2009.The alternative currency has seen a lot of action in its fairly short life.Bitcoins initially traded for next to nothing.The first real price increase occurred in July 2010 when bitcoins went from around $0.0008 to $0.08 for a single coin.The currency has seen some major rallies and crashes since then.Bitcoin was invented by the mysterious Satoshi Nakamoto in 2008 and released as an open-source software in early 2009.The first transaction took place between Nakamoto and an early adopter of bitcoin in January 2009.The first real-world transaction happened in 2010 when a bitcoin miner bought two pizzas from a Papa John's in Florida for 10,000 bitcoins.The currency is based upon a blockchain which contains a public ledger of all the transactions in the Bitcoin network.Those participating in the currency can mine for bitcoins using computer power.

The currency had a small initial interest among cryptographers and those seeking to engage in transactions that could not be easily traced.The currency gained wider exposure, both good and bad.More retailers opened up to using Bitcoin in 2012 and 2013.However, federal authorities shut down the Silk Road website, which used bitcoins for black market transactions, in October 2013.Gox bitcoin exchange also went under in 2014.Originally started as a site for trading game cards, it evolved into a marketplace for bitcoins.As of May 2013, the exchange was trading around 150,000 bitcoins per day.However, accusations of fraud surrounded the exchange when it closed down in 2014.The exchange lost around 850,000 bitcoins, although some of them have since been found.Bitcoin really started to take off in 2013.The currency began the year trading at around $13.50 per bitcoin.The price rallied in early April 2013 to get to over $220 briefly before dropping back down to around $70 by mid-April.This was the first real rally and associated crash for the currency.

Bitcoin really began to rally in October and November of 2013.The currency was trading at around $100 in early October.It reached around $195 by the end of October.In November, the price went from around $200 to over $1,120 by the end of the month.The rally was caused by new bitcoin exchanges and miners in China entering the marketplace.This period was also when the Mt.Gox exchange was operating.Gox was involved in around 70% of all bitcoin transactions.The price began to get very volatile after reaching these highs.Rumors of a lack of security through Mt.Gox, as well as poor management, made the market nervous.People had problems withdrawing their money from the exchange.The price reached a high of $1,230 on Dec.This fell to around $750 by December 7, a drop of around 39% over a couple of days.Trading stabilized to some degree to around $920 in January 2014.However, there was another major crash in early February, around the time the Mt.Gox exchange filed for bankruptcy protection in Japan.