Bitcoin steadies from 26pc slump as traders brave volatility

A bitcoin coin is seen in an illustration picture taken at La Maison du Bitcoin in Paris June 23, 2017. — Reuters pic
A bitcoin coin is seen in an illustration picture taken at La Maison du Bitcoin in Paris June 23, 2017. — Reuters pic

HONG KONG, Jan 17 — Bitcoin held above US$11,000 (RM43,484) a day after losing a quarter of its value as traders sought a floor for pricing amid growing concern regulators around the world will move ahead with new rules to restrict the burgeoning cryptocurrency industry.

The largest digital currency rose 4.7 per cent to US$11,190 at 10.35am in Hong Kong, recovering some ground after slumping as much as 26 per cent yesterday according to Bloomberg composite pricing. Ripple added 10 per cent while Ethereum rose about 6 per cent as rival cryptocurrencies also rebounded modestly.

“Cryptocurrency holders are trying to decide whether to abandon Bitcoin,” Steven Englander, head of research and strategy with Rafiki Capital, said in a Jan. 16 note to clients. “The dilemma is that once you stop pricing Bitcoin and its derivatives as new assets that will head to the moon, the pricing model is more conventional and much less breathtaking.”

Speculators across the globe are struggling to determine when or how market watchdogs may rein in an industry that’s decentralized and derives much of its value from anonymous ownership. Many assertions that digital coins represent a bubble have triggered double-digit selloffs over the past year, only to be followed by rebounds.

In South Korea, shutting down cryptocurrency exchanges is still an option amid ongoing discussions, Finance Minister Kim Dong-yeon said in an interview with TBS radio Jan. 16. Kim said there’s irrational speculation and that rational regulation was needed.

China, meanwhile, is set to escalate its clampdown on cryptocurrency trading, targeting online platforms and mobile apps that offer exchange-like services, according to people familiar with the matter.

In the US, state regulators are becoming more active with BitConnect shuttering its cryptocurrency exchange and lending operation after receiving two cease-and-desist letters from the Texas State Securities Board and North Carolina Secretary of State Securities Division for the unauthorized sale of securities and suffering from denial-of-service attacks. — Bloomberg