2017 has so far been a whirlwind year for cryptocurrencies. "The latest dip in bitcoin value may not mark the end of bitcoin investments", said Manoj Nagpal, CEO of Outlook Asia Capital. Cryptocurrency mining in China is huge, and traders rely heavily on blockchain transactions.
Bitcoin is having its worst week in years as its value plummeted below $3,000 on Friday morning.
Bitcoin has suffered 10 major corrections since 2010, at one stage dropping 94% between August and November 2011 and 85% between November 2013 and January 2015.
It's unclear whether China is effectively banning cryptocurrencies or if it wants to use a licensing system to gain control of the system. The cost of the bitcoin declined to 26,400 Yuan (almost to $4,029) on BTC China this week compared to 32,500 Yuan of last week. The currency is now down more than $550 from yesterday, and it's still trending downward. The first was part of a larger, industry-wide plunge that saw many cryptocurrencies falling by 20% or more in the span of just a day.
Jamie Dimon, chief executive of JPMorgan Chase & Co, also came out strongly against bitcoin this week dubbing it a "fraud", and adding that it will blow up.
Chinese authorities will close down bitcoin exchanges across the country, according to Market Watch.
Bitcoin is now down almost 30% from its peak at above $5,000 on September 1. All of that is likely to change, however.
The new rules on message groups have delivered a rare setback for WeChat, which permeates the daily life of 963 million users and underpins Shenzhen-based Tencent Holdings Ltd's US$400bil market valuation.
Some experts think the wider acceptance and government approval is not as certain as bitcoin investors expect. The price of a bitcoin dropped another 7 percent Thursday after one of the biggest Chinese exchanges is closing its doors. Or this could be the beginning of the end.