Bitcoin Price Weekly Analysis: Price Falls Back to 380, BTC Exchanges Unable to Pinpoint Reasons
Bitcoin has had one of its best weeks since August 2014, peaking US$500 per bitcoin on November 5, reaching a new yearly high and attracting the interest of high profile Chinese investors and well-established financial institutions.
However, the bitcoin price quickly depreciated as it surpassed US$500 in most Chinese exchanges including Huobi and BTC China, falling back to the US$380 zone and sustaining itself ever since.
interestingly, prominent bitcoin startup, exchanges and financial experts are unable to pinpoint the exact reasons to both the surge and depreciation of the bitcoin price. However, leading U.S. based bitcoin exchange Coinbase stated three possible reasons of it:
- Daily transactions
- Strong US Infrastructure
- China.
When asked about China, Coinbase declined to provide a direct answer as to how China could have affected the spike and the downfall of the bitcoin price. However, according to the announcements of two of the largest bitcoin exchanges OKCoin and BTC China, most Chinese financial experts are beginning to find an interesting pattern in the trades, and are suspecting a large operation of a ponzi scheme, designed to pump the price of the bitcoins and sell at its decline.
Coincidentally, shortly before the decline of the bitcoin price during the midnight of November 2015, China’s largest bitcoin exchanges including OKCoin and BTC China were hit by a series of extreme DDoS attacks, effectively taking down their exchanges temporarily for hours.
The exchange had to shut down its operations indefinitely and implemented several different DDoS attack protection solutions to protect its user funds. As the price began to fall, its users and investors had to watch the price go down by an average rate of 24.5% over the past 4 days.
Furthermore, the trading volume of OKCoin, the world’s largest bitcoin exchange in control of around 50% halved overnight,
Due to these coincidental series of events, financial experts and bitcoin exchanges including OKCoin suspect a pump and dump scheme to have occurred during the recent price spike.
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