This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Bitcoin Plummets After New Chinese Restrictions

Investors who bought into bitcoins at their high of more than $1,000 are now seeing big losses if they didn't sell them at higher prices already.

The value of a bitcoin was cut in half overnight after BTCChina, the world’s largest bitcoin exchange, said it would no longer accept deposits made in Chinese yuan. The price of the digital currency plummeted on BTC China, as well as Japanese exchange Mt. Gox and U.S.-based exchange Coinbase.

Bitcoins dip below $500

On Mt. Gox, volatility appears to remain within the bitcoin market. As of this writing, the exchange listed the lowest trade of the virtual currency as around $455 and the highest as being around $750. At Coinbase, the current price was listed as around $542. Bitcoins had been trading at over $1,000 each earlier this month.

Last week a European watchdog group warned of the dangers in investing in bitcoins, highlighting the extreme volatility the market has seen. Just a single bit of news like today’s announcement from China is able to send prices soaring sky-high or plummeting to the ground.

China’s bitcoin exchange stops accepting yuan

Overnight for the Western world anyway, BTC China said it was “temporarily” not accepting deposits made in China’s currency, the yuan. On Tuesday there were reports that the People’s Bank of China met with approximately 10 big payment processors to order them to no longer work with bitcoin exchanges. A spokesperson for BTC did tell Coindesk that although it would no longer accept deposits made in yuan, users could still withdraw yuan from the exchange.

One of the reasons the price of bitcoins has soared recently is because of significant demand in China. As a result, the news from China is an especially big deal for those interested in the digital currency.

U.S. Treasury also cracks down on bitcoin

China isn’t the only nation to crack down on bitcoin-related business. On Tuesday Reuters reported that the U.S. Treasury’s anti-money laundering division reminded businesses related to bitcoins that they could have to start meeting the legal and regulatory requirements which currently affect other money transmitters.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,083.80 -2.83 -0.02%
S&P 500 1,987.98 +0.97 0.05%
NASDAQ 4,472.1080 -1.5890 -0.04%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs