The value of one Bitcoin went back above the $4,000 mark on Wednesday, continuing a wild ride over the last couple months.
Bitcoin—which was only worth $1,000 at the start of the year—previously broke the $4,000 barrier in mid-August before briefly clearing $5,000, but then a series of events brought it crashing down to below $3,000 a month later.
Those events included J.P. Morgan CEO Jamie Dimon calling Bitcoin a “fraud” and Chinese regulators making a series of anti-Bitcoin moves, including banning initial coin offerings (a way of funding new startups by issuing tokens rather than shares) and reportedly cracking down on bitcoin exchanges in the country.
Bitcoin briefly topped $4,000 at the start of last week, but since then it settled down to around the $3,500 mark. Now it’s back up, with a value of $4,059 at the time of writing on Wednesday morning.
So, what’s prompted this latest rally? It could be the current speculation that China’s exchange crackdown is only temporary—a show of force ahead of the Communist Party Convention in October.
The crackdown has been widely reported but never formally announced, and one of its supposed rationales is that people in China have been using Bitcoin to bet against the value of the yuan, as well as to get round local capital controls.
It may be that the rumors were aimed at ensuring stability in the crucial period ahead of next month’s big event—they have certainly had an effect, leading major exchanges such as BTCChina to shut down their Chinese operations.
However, whether or not the Chinese exchange ban gets formalized, it does seem that Bitcoin has resistance to the actions of that one country—even if it remains a highly turbulent game to be playing.