By Michael Krieger: The past several days have seen considerable weakness in the price of
bitcoin. The selling was sparked by the revelation that the Chinese
government had essentially instructed its financial system to avoid it.
Then yesterday it was revealed that China had banned third-party payment
companies from doing business with bitcoin exchanges. As far as price
is concerned, I have stated repeatedly via Twitter that I think the
China news caps the upside in the near-term (baring other material news
of course) and that we are in a new range of $650-$1050 per BTC. At
roughly $700 where we are now, I think at least 75% of the “China
premium” is now out of the price. This sets up a solid risk/reward
profile. However, there is one thing in the U.S. that people should be
aware of and represents some headline risk if true.
Recently, a friend of mine noted that Chase has threatened to shutdown his business account due to his use of Coinbase (remember Coinbase recently received the largest VC investment in Bitcoin to-date). Apparently, the problem hasn’t been when money moves out of U.S. banking deposits and into the Bitcoin ecosystem, but rather when the currency is converted back to dollars and then deposited back into the Chase accounts. With this already being in my mind, I read the following Reddit post this morning:
Hi everyone,
A few weeks ago, I posted that Chase decided to terminate my account, and they never notified me as to why they would do this. However, I believed it to be Bitcoin-related.
Recently, a friend of mine noted that Chase has threatened to shutdown his business account due to his use of Coinbase (remember Coinbase recently received the largest VC investment in Bitcoin to-date). Apparently, the problem hasn’t been when money moves out of U.S. banking deposits and into the Bitcoin ecosystem, but rather when the currency is converted back to dollars and then deposited back into the Chase accounts. With this already being in my mind, I read the following Reddit post this morning:
Hi everyone,
A few weeks ago, I posted that Chase decided to terminate my account, and they never notified me as to why they would do this. However, I believed it to be Bitcoin-related.