Bitcoin holds little changed near $891 a coin as of 7:02 a.m. ET. The cryptocurrency is contending with resistance in the $900 area for the third straight session. Bitcoin raced to more than $916 on Tuesday but was unable to break out above the early-January resistance level.
Bitcoin has gotten off to a wild start in 2017. Buying in the opening days of the year lifted its price more than 20% and above $1,000 for the first time since November 2013. However, rumblings about a crackdown on trading in China have caused jitters as of late. Beijing announced it had begun investigating bitcoin exchanges in Beijing and Shanghai on suspicion of market manipulation, money laundering, unauthorized financing, and other issues. The price crashed 35% to nearly $750 before finding support and working its way back up to resistance in the $900 area.
Thursday’s action has to alleviate some concerns regarding the trading environment in China as Beijing announced it was tightening capital controls even further. While the rules were aimed at outbound investments by centrally-controlled state firms, it is still notable that bitcoin has so far been spared. In a note to clients on Wednesday, Deutsche Bank’s Torsten Sløk showed how China dominates the global bitcoin market, accounting for nearly 100% of the trading.