Reason behind today's flash crash.
The People's Bank of China issued a statement today, January 11th, that appears to have coincided with the flash drop of Bitcoin value from $927 to $850 at about 4 am Eastern Time . This follows the previous drop on January 5th from $1166 on earlier regulatory concerns.
January 17, 2017, the People's Bank of China Shanghai headquarters, the Shanghai Municipal Finance Office and other units to form a joint inspection team on Bitcoin China to carry out site inspections, focusing on checking whether the enterprise beyond the scope of Operation, whether or not without a license to carry out credit, payment, exchange and other related business; whether there is market manipulation; anti-money laundering system implementation; financial security risks and so on.
It is not yet clear what the extent or intent of these inspections will be, or how they will affect the bitcoin exchanges. As of writing this article Bitcoin prices were recovering to around $870.
Strong arm tactics. Shakin' up a few people to remind them who is boss.
PBC has played this game before. Public persona is that we can and will crush "the bitcoin" at anytime. Meanwhile "the bitcoin" is a multi-billion dollar boon for China tech sector. And 'wink' a means for China banksters to play currency war games without getting caught.
The message is clear, "Don't fuck with our sheep/clients in the banking sector". [But feel free to continue bitcoining the rest of the world ... might be wise to have a Hong Kong account too]
you quoted that tho?
What I am not sure of is how in depth these site inspections will be. If they are rigorous, they may find skeletons in the closet. Also, although they state what they will be looking for, but, I think the elephant in the room is them checking for how significant bitcoin exchanges are for facilitating capital outflow.