May be of interest:

Business Insider, April 01, 2014
A Judge Has Ordered The CEO Of Bankrupt Bitcoin Exchange Mt. Gox To Appear In The US
http://www.businessinsider.com/r-judge-orders-mt-gox-ceo-to-us-for-questions-on-failed-bitcoin-exchange-2014-01

Chinese Slumber Method prediction for Wednesday April 2

April Fools day is not over yet, so making again a fool of myself:

Prediction valid for: Wednesday 2014-04-02, 19:00--19:59 UTC (not before, not after)
Huobi's predicted price: 2963 CNY.
Bitstamp's predicted price: 490 USD.


Plot legend

Huobi's clients did not have an easy night, and this last Slumber Point was somewhat weak (S = 0.0091, W = 0.192).  Still, the Method says to use the straight trend line defined by the last two Slumber points: A + B*(d-d0) where d-d0 is the number of days since Mar/31 , A = 2759, B = 102.

The Bitstamp prediction, as usual, is the Huobi prediction divided by the currency conversion factor R, which was assumed to be 6.05 CNY/USD (it was 5.96, 6.06, 6.02, 6.08 at the last four Slumber Times, skipping the bad Mar/30 point).

Checking the previous prediction

Prediction was posted on: Tuesday 2014-04-01, 04:02 UTC
Prediction was valid for: Tuesday 2014-04-01, 19:00--19:59 UTC (~15 hours later)

Huobi's predicted price: 2759 CNY.
Huobi's actual price (L+H)/2: 2861 CNY
Error: 102 CNY (~17 USD)

Bitstamp's predicted price: 455 USD.
Bitstamp's actual price (L+H)/2: 480 USD
Error: 25 USD

EDIT: the prediction was posted at 04:02, not 01:00.

NOTE: If a circular is sent to the banks by PBoC, but no reporter is there to see it, does it make a crashing sound?

Trying to summarize the situation again:

* A Caixin reporter claimed last week that he saw a PBoC document, to be sent to banks and third-party payment processors, prohibiting them to pass CNY deposits to the exchanges immediately (through corporate or personal accounts), and setting a deadline of april 15 for them to stop processing withdrawals too.

* The Chinese exchange Bter warned their clients that their payment processor stopped all deposits to them. So that part of the Caixin claim, at least, was true.

*  As for the bank part of the Caixin claim, so far there is only ONE source for that claim. namely that Caixin reporter. 

* Bter did not use banks, and other exchanges have not reported any blocking  of deposits yet.

* On the other hand, the PBoC has not denied that claim yet, five days after it was leaked.

* The exchange CEOs commented the matter at first, but have been silent since then.

I do not know what to think, and apparently the Market is confused too.

If the bank blockade order is real, perhaps the exchange CEOs are lobbying the PBoC to reverse or soften it --- hence their silence?

I recall reading somewhere that workers in China get paid at the end of the month; is that so?  Perhaps the exchanges' corporate bank accounts were kept open until now so that they can pay their staff?

Another (very unlikely) possibility is that the banks understood the order to mean that they can accept the client deposits into the exchanges' accounts, but cannot allow the exchanges to withdraw money from those accounts? (In that case the exchanges could still function normally, by leaving all the deposited money in that account and executing client CNY withdrawls from it, until April 15; except that they could not collect  the deposit/withdrawal fees.)

What is the mechanics of depositing CNY on the Chinese exchanges through the banks?   Would the exchanges notice immediately if the deposits are blocked?  If the exchanges have other sources of revenue, or investor funds in the bank, would they be blocked too? How would the banks know which money is which?

 

Perhaps there will be rather strict limits on the amount of $ one can convert this way? Limits on the contents of a card and/or amount available in a store?

One interesting thing is that one would be able to pay by handing over the card, rather than transferring the bitcoins.  We could call this new payment method "carry and swap handling", or CASH for short.  

(EDIT: typos)

I mean, the article just rehashes the same news we have seen up to yesterday, right?  Namely, with no confirmation but no denial yet of the bank account closure rumor.

Anyway the WSJ article has no real news, has it?

EDIT: removed unrelated quote

Indeed, in parts of Australia it is April 2nd already.

Yes, it is far-fetched, but I wonder what Google Translate (or its Chinese equivalent) would do to that article.  

You must be careful with jokes on international forums, the humor is often lost in translation.  The Chinese, for example, seem to have taken that Coindesk article seriously.

Do people really believe that by analyzing the past prices one can tell whether the PBoC rumor is true or false?

Idle exercise:

The Market now assigns some probability P to the bank blockade rumor being true.

If the rumor is false, the price should go up again to the pre-rumor level, ~580 USD (Bitstamp).

If the rumor is true, the price should go down to some value X, less than 480.

The current price should be the Market's expected price in the near future (even if the Market is not conscious of these computations, and plays it "by ear"). That is,

  P*X + (1-P)*580 = 480    <==>
  P*(580 - X) = 580-480 = 100   <==>
  P = 100/(580-X)   <==>

Since X < 480, we have P < 100/(580 - 480) = 1, not informative.

Since X > 0, we have P > 100/580 = 0.17.

Therefore the Market thinks that there is at least 17% probability that the bank block is true.

What do you mean?  Arbitrage traders buy where it is cheaper (e.g. at Huobi, right now) and sell where it is more expensive (e.g. Bitstamp).

No news apparently.   I suppose that, as the more pessimistic Chinese sell all  their coins, the arbitrage traders have to buy from the slightly less pessimistic ones, so the price gradually goes up.

I understood their clarification as: "we used a payment processor, that suspeded its service; we do not use bank accounts, so we have no information about that part of the rumor."

This Chinese thread seems to say that bank deposit (?) at OKCoin was still working today (Apr/01) around 09:00 local time.

Chinese Slumber Method prediction for Tuesday April 1

Just to make a fool of myself:

Prediction valid for: Tuuesday 2014-04-01, 19:00--19:59 UTC (not before, not after)
Huobi's predicted price: 2759 CNY.
Bitstamp's predicted price: 455 USD.


Plot legend

The last Slumber Point was quite good (S = 0.0018, W = 0.936) but the previous one was very bad (S = 0.0140, W = 0.020).  Therefore the only reasonable trendline is the constant function, namely "the next Slumber Price will be the same as the last one".

The Bitstamp prediction, as usual, is the Huobi prediction divided by the currency conversion factor R, which was assumed to be 6.10 CNY/USD (it was 6.06, 6.02, 6.08 at the last three Slumber Times, skipping the Mar/30 one).

NOTE: Today is April Fools day.  Every day is Greater Fools day.

By the way, I found this in a Chinese CERT meeting report:

EDIT: the URL is  http://tech.sina.com.cn/other/2014-03-31/18499286829.shtml

Apparently the Caixin report has not been confirmed or denied yet with respect to bank accounts. 

On one hand, AFAIK there have been so far no reports of blocking of CNY deposits via the exchanges' bank accounts.  So it is still possible that the Caixin report was wrong on this point.

On the other hand, Bter was told by a payment processor that it was suspending payments by order higher orders.  So the Caixin report was at least partly true.

From the price changes, it seems that the market was a little more pessimistic today (Monday), but the uncertainty pretty much remains the same as yesterday's.

Again, if the bank blockade rumor is denied tomorrow, is seems likely that the price will rebound to near Wednesday's levels.  (There may be even a temporary spike to higher levels, if the Chinese rush to buy back before the arbitrage traders can move back to China all the coins that they took out.)

If the blockade is confirmed, the price can only drop:  a little or a lot, I would not dare to guess.

It is 5am in China, why are those guys dumping NOW?

Actually, who knows where it started, the drop is also at Bitstamp, Bitfinex, OKCoin, BTC-China... Arbitrage traders are darn fast it seems...

This December 2013 artice gives some hints about that question (as of that time):
http://www.csmonitor.com/World/Asia-Pacific/2013/1206/Why-the-Chinese-can-t-get-enough-of-Bitcoin-despite-bank-ban
At least, it cites someone in China who did some research for some Chinese consultancy firm...