Bitcoin surges past $1,000 as dollar falls during Chinese New Year

Affected by the decline of the US dollar and the Chinese New Year, Bitcoin began to get rid of the pressure of Chinese regulation and rose again. Today, Bitcoin broke through the $1,000 mark for the first time since January 5.

On January 5, after breaking through the historical high, the price of Bitcoin experienced a flash crash. According to the market information of Huobi.com and OKCoin, two well-known domestic trading platforms, the highest price of Bitcoin during the trading session was close to 9,000 yuan, and then it quickly plunged to around 7,100 yuan, a drop of more than 20%.

Wall Street Journal previously mentioned that according to the Shanghai headquarters of the People's Bank of China and the Beijing Business Management Department of the People's Bank of China, on January 11, the inspection team of the People's Bank of China entered the Bitcoin and Litecoin trading platforms such as "Bitcoin China", "Huobi.com" and "Bihang" to conduct on-site inspections on the trading platforms' implementation of foreign exchange management, anti-money laundering and other relevant financial laws and regulations, and relevant regulations on trading venue management.

Affected by this, Bitcoin's decline further expanded, falling below the 5,400 yuan mark. Bitcoin China's lowest price was 5,380 yuan, a sharp drop of nearly 15% on the day (the following chart is from Bitcoin China). Bitcoin denominated in US dollars fell to as low as 816.3 US dollars, a drop of more than 10% on the day.

In 2016, the increase in Bitcoin exceeded 200%, not only surpassing any currency pair in the foreign exchange market, but even surpassing star products such as real estate and black metals.

Some analysts said that the rise of Bitcoin was mainly due to capital and currency restrictions in countries such as China, India and Venezuela, which prompted people to buy electronic currencies to preserve their savings and also prompted investors to continue buying. In the past year, Bitcoin, as an investment asset, has beaten all other currencies, stock indices and commodity contracts.

Currently, the price of Bitcoin is more driven by the Chinese market, which accounts for more than 90% of the global trading volume. In 2013, the price of Bitcoin once exceeded $1,100, even more expensive than gold. However, with the theft of the largest Bitcoin exchange and increasing regulatory pressure, Bitcoin once fell by more than 80%.