The price of virtual currency Bitcoin rebounded on Thursday, as investors returned to the market to seek cheap valuations following the previous session’s 24% plunge.
BTC/USD rallied 10% during European morning hours to trade at USD644.00 on the Tokyo-based Mt. Gox Bitcoin exchange. The currency rose by as much as 11.1% earlier in the day to hit a session high of USD650.60.
Bitcoin lost nearly a third of its value on Wednesday after BTC China, the world’s largest exchange by volume, said it has stopped accepting new yuan deposits.
The move came after the People’s Bank of China banned third-party payment service providers from offering clearing services to online Bitcoin exchanges earlier in the week, a crippling blow that could make it much harder to trade the virtual currency in China.
The PBOC recently said that Bitcoin did not qualify as a currency and lacked legal protections and that financial institutions and payment systems were not allowed to take deposits from Bitcoin-related businesses.
Rising demand from China has seen the country become the largest Bitcoin market in recent months, as buyers seek to profit from speculating in the currency.
Bitcoin is digital cash for the internet and it is not backed by a government or central bank to regulate or issue it. It can be used to purchase goods and services from an increasing number of stores and online retailers.
Prices of the virtual currency are still down approximately 48% since hitting an all-time high of USD1,241.10 on November 29. It was trading at USD100 in early October.
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