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    Lightbulb Bitcoin price tumbles after warning from Chinese central bank, The Corliss Technology Review Group

    The People's Bank of China has issued a warning that the currency is not legally protected and has no 'real meaning'.


    The Chinese central bank has warned the country's financial institutions not to trade in bitcoin, saying that the digital currency doesn't have "real meaning" and lacks legal protections.

    However, no explicit risk to China's financial system was identified by the bank, and it reiterated that individual citizens were free to use bitcoin provided they were aware that they were taking the risk on themselves.

    The bank also identified money laundering and other illegal uses of the currency as areas of concern.
    Bitcoin has recently achieved a measure of popularity in China, with FiatLeak and other bitcoin trading information sites showing large inflows of the currency through Chinese exchanges.

    China Telecom, the largest mobile phone provider in the country, launched a promotion allowing a Samsung phone to be bought with bitcoins, and Baidu, the Chinese Google, is accepting payments for its firewall service in the currency.

    But there's also suspicion that a large measure of the bitcoin's Chinese popularity is the result of fringe-legal uses. The currency is perfect for getting around the country's tight capital controls, which prevent rich Chinese citizens from moving too much money overseas.

    While bitcoin remains unregulated, it is easy for users to buy a large sum in Chinese yuan and sell it in US dollars, evading those regulations.

    The potential of bitcoin in China is seen as a large part of the reason for the currency's seven-fold increase in price over November, and the news that the Chinese central bank is taking a less-than-welcoming stance to it has sent markets tumbling.

    The value of one bitcoin fell by 28% over two hours on Thursday morning, before settling into its more normal pattern of rapid large price swings in both directions.

    The warning follows a similar cautionary tone from the Dutch central bank, which noted that there is no central issuer who can held liable for bitcoin, and no deposit guarantee scheme in the event of bitcoin banks failing.
    The former head of the Dutch bank even compared the bitcoin bubble to the Netherlands' tulip mania in the 17th century – but pointed out that at least when that bubble burst, investors were left with tulips at the end.
    Last edited by Hosaiffdein; 12-26-2013 at 11:41 PM.
  2. #2  
    wizzrah's Avatar

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    Default Re: Bitcoin price tumbles after warning from Chinese central bank, The Corliss Technology Review Gro

    Quote Originally Posted by Hosaiffdein View Post
    The People's Bank of China has issued a warning that the currency is not legally protected and has no 'real meaning'.


    The Chinese central bank has warned the country's financial institutions not to trade in bitcoin, saying that the digital currency doesn't have "real meaning" and lacks legal protections.

    However, no explicit risk to China's financial system was identified by the bank, and it reiterated that individual citizens were free to use bitcoin provided they were aware that they were taking the risk on themselves.

    The bank also identified money laundering and other illegal uses of the currency as areas of concern.
    Bitcoin has recently achieved a measure of popularity in China, with FiatLeak and other bitcoin trading information sites showing large inflows of the currency through Chinese exchanges.

    China Telecom, the largest mobile phone provider in the country, launched a promotion allowing a Samsung phone to be bought with bitcoins, and Baidu, the Chinese Google, is accepting payments for its firewall service in the currency.

    But there's also suspicion that a large measure of the bitcoin's Chinese popularity is the result of fringe-legal uses. The currency is perfect for getting around the country's tight capital controls, which prevent rich Chinese citizens from moving too much money overseas.

    While bitcoin remains unregulated, it is easy for users to buy a large sum in Chinese yuan and sell it in US dollars, evading those regulations.

    The potential of bitcoin in China is seen as a large part of the reason for the currency's seven-fold increase in price over November, and the news that the Chinese central bank is taking a less-than-welcoming stance to it has sent markets tumbling.

    The value of one bitcoin fell by 28% over two hours on Thursday morning, before settling into its more normal pattern of rapid large price swings in both directions.

    The warning follows a similar cautionary tone from the Dutch central bank, which noted that there is no central issuer who can held liable for bitcoin, and no deposit guarantee scheme in the event of bitcoin banks failing.
    The former head of the Dutch bank even compared the bitcoin bubble to the Netherlands' tulip mania in the 17th century – but pointed out that at least when that bubble burst, investors were left with tulips at the end.

    I'm not sure if you actually typed this or you copied it from some other news article. You should give credit if you did. Bitcoin to me is not safe (as of 12/26/13). There is so much fluctuation in its pricing and stability that it sucks. While it remains popular, I still don't understand how it caught on so fast. Probably from the publicity that the few "early miners turn into millionaires" got. There's also been an increase of bitcoin theft. While you may argue that bitcoin has the same risks as a credit card and what not, I beg to differ. I think in order for bitcoin to be accepted in various countries, the population either has to be more educated on bitcoin or bitcoin has to get more organization into it.
    It is our choices, that show what we truly are, far more than our abilities. - J. K Rowling

    "If you love life, don't waste time, for time is what life is made up of." - Bruce Lee

    "The story of life is quicker then the blink of an eye, the story of love is hello, goodbye." - Jimi Hendrix
  3. #3  

    Default Re: Bitcoin price tumbles after warning from Chinese central bank, The Corliss Technology Review Gro

    Quote Originally Posted by wizzrah View Post
    I'm not sure if you actually typed this or you copied it from some other news article. You should give credit if you did. Bitcoin to me is not safe (as of 12/26/13). There is so much fluctuation in its pricing and stability that it sucks. While it remains popular, I still don't understand how it caught on so fast. Probably from the publicity that the few "early miners turn into millionaires" got. There's also been an increase of bitcoin theft. While you may argue that bitcoin has the same risks as a credit card and what not, I beg to differ. I think in order for bitcoin to be accepted in various countries, the population either has to be more educated on bitcoin or bitcoin has to get more organization into it.
    And paper money has value?lol.

    Posted via Android Central App
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    Default Re: Bitcoin price tumbles after warning from Chinese central bank, The Corliss Technology Review Gro

    Quote Originally Posted by stackberry369 View Post
    And paper money has value?lol.

    Posted via Android Central App
    I don't think I stated anywhere that bills have value. The only reason it has worth is because of the way many economies are built. It's kinda funny knowing that your wealth in this world depends on how much paper you have...

    Sent from my HTC One XL using Tapatalk
    It is our choices, that show what we truly are, far more than our abilities. - J. K Rowling

    "If you love life, don't waste time, for time is what life is made up of." - Bruce Lee

    "The story of life is quicker then the blink of an eye, the story of love is hello, goodbye." - Jimi Hendrix
  5. #5  

    Default Re: Bitcoin price tumbles after warning from Chinese central bank, The Corliss Technology Review Gro

    Quote Originally Posted by wizzrah View Post
    I don't think I stated anywhere that bills have value. The only reason it has worth is because of the way many economies are built. It's kinda funny knowing that your wealth in this world depends on how much paper you have...

    Sent from my HTC One XL using Tapatalk
    The paper is made from trees lol.

    Posted via Android Central App
  6. #6  
    wizzrah's Avatar

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    Default Re: Bitcoin price tumbles after warning from Chinese central bank, The Corliss Technology Review Gro

    Quote Originally Posted by stackberry369 View Post
    The paper is made from trees lol.

    Posted via Android Central App
    I think in a moral sense trees are worth much more, but we're stupid enough to value them so low.

    Sent from my HTC One XL using Tapatalk
    It is our choices, that show what we truly are, far more than our abilities. - J. K Rowling

    "If you love life, don't waste time, for time is what life is made up of." - Bruce Lee

    "The story of life is quicker then the blink of an eye, the story of love is hello, goodbye." - Jimi Hendrix

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