Central bank shot! Today, bitcoin crash

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Central bank shot! Today, bitcoin crash

2017-01-12 00:34:16 71 ℃

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Bitcoin market in early 2017, seems to repeat the situation at the end of 2013. January 5th, has been born 8 years bitcoin prices stand on a new high, the day was up to $8895. But the flash crash began, good times don't last long, as of January 10th 16:50, once again fell to 6347 yuan, just a few days, or up to 40%.

But in today (January 11th), the Central Bank of Beijing business department and the headquarters of the Bank of Shanghai also announced a joint news release, local financial departments in the fire currency network, bitcoin currency, China platform, trading platform to implement the administration of foreign exchange, money laundering and other relevant financial laws and regulations, the relevant provisions of the management and other trading venues to carry out on-site inspection.

Affected by this news, bitcoin prices diving again. 11 afternoon, the above quoted price of the three trading platform once fell below or touched $5800, as of press time reporter, part of the platform has fallen below the $5400 mark, fell nearly 15% days.

So the question is, why in the end bitcoin can jump and collapse?

Supervision after another shot, bitcoin and flash collapse"

After the emergence of a sharp decline in January 5th, the data show that in January 11th, bitcoin prices have dropped from 8000 yuan to a high of about $5400.

The afternoon of January 11th, the Central Bank of Beijing business department official website announced that has formed the joint inspection group and the Beijing Municipal Finance Bureau and other units, in January 11th in the "fire currency network" and "money" etc. bitcoin, Wright currency trading platform, trading platform to implement the foreign exchange management, anti money laundering and other relevant financial laws and regulations, the relevant provisions of the management of trading venues to carry out on-site inspection etc..

At the same time, the central bank Shanghai headquarters and Shanghai city finance office and other units of the joint inspection group to carry out on-site inspection of the "bitcoin Chinese", focus on examination of the enterprise is beyond the scope of business, whether without permission or no license to carry out credit, payment, exchange and other related businesses are involved; market manipulation; the implementation of anti money laundering the system of security funds.

After the news release of the central bank on-site inspection, fire currency bitcoin prices have a short-term diving, fell from 6300 yuan to less than $6000. As of press time (11 20:10 or so), fire currency bitcoin prices have dropped to $5400 mark, fell nearly 15% days.

The picture cut from the fire coins network

Since 2016, along with the hot block chain, bitcoin out of a wave of bull market, from the beginning of 2016, the lowest of about $2300 rose to the highest in January 5, 2017 about $8800, or up to 280%. In many assets, eye-catching performance.

Bitcoin is almost impossible because of the large swap, currency swap is difficult, and the need to bear the risk of price fluctuation. In overseas platforms, especially in the U.S. mainland bitcoin trading platform, KYC (KYC policy, that is, to fully understand your customers) to do more stringent than China, the process is more complex, high cost.

In addition, from the bitcoin market in recent years, the basic price is $domestic RMB price is higher than the overseas platform, from the economic point of view, bitcoin exchange is not a feasible way.

High leverage platform risk highlights

"Before the crash in January 5th, a lot of people used leverage." Bitcoin investors Li Ming (a pseudonym) told the daily economic news reporter.

Li Ming said the leverage trading is a trading system currently used bitcoin platform, similar to the stock market in the margin, bitcoin investors to the platform financing currency, long and short two-way operation.

According to the daily economic news reporter, at present, the two largest bitcoin trading platform fire currency network and currency lines are provided with a maximum of five times the amount of leverage, leverage rate of daily fee of 0.1%. Fire currency network insiders told reporters that the leveraged funds provided by fire money from the platform of its own funds.

The fire coins online on the lever operation schematic

Leverage can be leveraged to enlarge the principal to obtain excess returns, but also means that the risk is magnified. According to the provisions of the fire currency network, when the user's leverage position risk ratio (total assets \/ leverage, leverage, including the amount of fees) less than 110%, the system will be forced to open.

Professor Deng Jianpeng, Minzu University of China School of law Internet expert financial research in the daily economic news reporter said, the current bitcoin trading platform profit model mainly through the provision of service charges of financial currency financing, funds interest of up to 36%, of which there is a big risk.

In addition to the risks brought about by leverage, trading platform itself also allows investors to bear the risk of another unpredictable. Li Ming told the daily economic news reporter, because the afternoon of January 5th can not log on the trading platform, his account was forced to open.

"In January 5th five. I fire APP currency can not log in, then I received at around half past five recharge reminder, because my account value is lower than the closing lever value, but after trying various ways, still can not log on account." Li Ming said, because the use of leverage, so hurry up to prevent forced liquidation. But log on the Internet version of the money is already more than 6 points, the details of the transaction details found in the accounts at more than 5 points have been strong ping."

Li Ming borrowed 5 times leverage on the fire coins, invested $30 thousand to be enlarged to $150 thousand. In this strong Ping, Li Ming lost 21000 yuan.

Due to the rapid rise and fall of bitcoin, investors often take the form of planned trading, set a stop loss, in order to prevent the collapse of the loss. Li Ming said he planned to set up the transaction on the same day also failed, the usual plan for the transaction are very useful, but in January 5th when the slump did not play a role."

The fire bitcoin currency network chart shows that in January 5th the same day, the fire coins online bitcoin price once reached a high of 8895 yuan, fell to the lowest 6000 yuan, amplitude reached 48.25%. "A lot of people have been forced out." Li Ming told reporters.

* source: Oriental IC

Another bitcoin investor Yang Guang (a pseudonym) to the daily economic news said that the previous encounter rose or fell when the fire coins network "terminal or APP also appeared unable to log on, trading case caton. He said that in January 7th the fire currency network again unable to deal with the situation, but the duration is short.

For the platform can not log in the case, fire currency network, said that due to the influx of new investors too much, resulting in problems with the platform. According to the fire coins network data show that in January 5th at 1 o'clock in the morning to break through the history of the highest price of $8000, the same day in the afternoon of 13 bitcoin rose to a record high price of $8895. After the day of media reports, the number of registered users and the number of days of the fire currency network has reached a record high. Data show that in January 5 the fire currency network, who have registered number is 10 times in January 2016 the average daily number of registered users. The sudden increase in the number of visits to the user's access to the fire currency APP timeout, while the official website of the fire money Web can be used, the same day the official website issued a notice to suspend the use of fire APP.

In addition, the fire currency network also said that due to the January 5th price of the day there was a greater volatility, they lowered the leverage limit, up to 2 times leverage.

According to the China Securities Journal reported on January 9th at 1 in the morning, there is also a failure of the bank website, trading suspended for more than and 10 minutes. In this regard, Zhang Jun, assistant president of the bank to the daily economic news reporter, said the transaction was suspended due to system upgrades, because of the surge in the number of users, resulting in the system needs to be upgraded to better serve the growing user. In addition, she said, when the price volatility is relatively large, the leverage business will generally be suspended.

Each edited by Zhao Yun