I disagree. This is not good news for Bitcoin.

>3. At this stage, financial institutions cannot denominate services and products in bitcoin, cannot trade bitcoin, cannot run bitcoin exchange, cannot provide bitcoin related services, cannot store bitcoin for clients, cannot establish bitcoin trust or fund, etc.

I don't speak Chinese so I can't speculate too much, but by the sounds of the Reuters article this basically rules out any hope of a Coinbase equivalent emerging in China, allowing people to transact freely between their bank and their BTC wallet. Banks in China aren't going to touch Bitcoin, or BTC-related businesses with a barge pole now. Not only this, anyone else planning on starting a Bitcoin business will probably have trouble with banks. It's really not good at all for BTC in China.

I disagree with you, I think that it means that a chinese Coinbase can't also be a bank, and since they just ruled that bitcoin is not a currency, it will be sold and bought freely as a commodity in this case a virtual commodity

Trading physical goods for virtual commodities? No thank you.

The pudding of bitcoin was the promise of a new currency.

Since it's decentralized, it doesn't need banks to prosper. That's the beauty of bitcoin. It can function as a currency while still being seen as a commodity in the eyes of the law.

Yes - it doesn't need banks. I think there is lots of confusion as to how this system works. As long as it's legal to own and exchange bitcoins, everyone can be their own financial institution.

I think I cant understand what a world run on bitcoin would look like without a global war.

I kind of agree.

The Chinese like to gamble, so something rocketing up was bound to attract speculators.

Some people claim this move is to prevent capital flight from China, which is possible, but unlikely given the volatility of the BTC-USD exchange rate and the need for someone trustworthy i.e. family to be on the receiving end of the transaction who then needs to liquidate and remain tax compliant (if applicable).

This sounds like when the dotcom bubble burst, and the so-called experts were saying "No, this is a GOOD thing! All your favorite stocks are on sale!"

The thing that propelled BTC from 200 to 1200 was the news that BTC was gaining popularity in China. If this news turns negative, then what is keeping the price high?

Then again, given BTC has been so strongly bought up, if it gets bought up here, then it just means it will keep skyrocketing, since buyer sentiment hasn't changed one bit.

Time to sell Bitcoin.

Merill Lynch just said buy Bitcoin, setting a target of 1300 (I hate the way Wall Street pulls these numbers out of thin air, but they are on the sell-side).

This is the same Merill Lynch who collapsed their own company with dodgy investments and had to be passed off to Bank of America, another company laden full of dodgy assets and dodgy accounting.

If these guys say "buy", isn't it time to run?

http://www.zerohedge.com/news/2013-12-05/bofaml-sees-bitcoin...

You can't extract intelligence from stupidity.

By taking the inverse of anything they say, you're implying that they have perfect prediction power (even if it's inverted).

If you don't trust their predictions at all, then you should treat anything they say the same you would a random number generator.

I worked in Treasury for a Fortune 500 with operations in 80 countries, responsible for FX hedging, and I can say that ALL banks are absolutely terrible currency forecasters. I can't blame them for being inaccurate, since there are so many variables that can impact an exchange rate between currencies, but it's important to note that forecasted currency rates have no merit.

When is anyone at bitcointalk not BULLISH about bitcoin? It's not like they have a financial incentive to let it tank.

While many trolls and the like do roam bitcointalk, one can also find the occasional gem of rationality, insight, and common sense.

Some people are there because, if you can believe it, they are actually intellectually interested in the complex and novel dynamics (sociological, economic, technical, etc) found in bitcoin (or that may potentially develop as the system grows).

Also, I'd like to add that most of the FATAL FLAWS (TM) that the mainstream press is discussing today were discussed in great detail on bitcointalk since 2009.

It just happens to be a community that has had a great interest in creating and seeing bitcoin succeed. Of course, with growing numbers, the noise hides the signal, but take a look at the relevant subforums and you will indeed see serious discussions about bitcoin viability, previous challenges, future challenges, network security, scalability, etc.

I thought the value of BTC in china was that it enables ordinary people to workaround the current financial system.

They say "It [BTC] represents an unofficial leakage to the current monetary system and trades globally" ...

So, isn't a question of time before they ban the protocol in China ? I don't see why people use BTC in China, if it isn't for the freedom (workaround) that it gives..

So in China Bitcoin status is equal to World of Warcraft goods (swords, shields, etc)? I mean WoW goods one can buy on eBay.

Similar what (some?) countries in EMU were saying. It's not a currency, you can use it at your own risk. Also you can't print/create physical representation IIRC, i.e. money.

Same same but different. The PBOC has taken swift action, while other central banks have just been talking.

A physical representation of bitcoins (e.g. paper) would be terribly cumbersome.

To be clear, this already exists :) https://en.wikipedia.org/wiki/Bitcoin_protocol#Paper_wallets...

So, bitcoin prices plunge 20% on bullish news ?

Yeah, like for the Silk Road, until it bounces back with double its value in a matter of weeks. Bullish does not mean instantly bullish.

It also means that in the interest of experimentation, the US will likely do the opposite of China.