the PBOC do not care about bitcoin exchanges.
remember this simple truth
for every bitcoin buyer is a bitcoin seller.. ergo for every yuan trader is another yuan trader.
Yuan doesn't disappear/get burned. it just passes hands.
it doesn't disappear in a bottomless pit of paper money. it sits in chinese banks. staying in chinese banks circulation
ultimately nothing changes for the yuan apart from which account holder is holding the yuan.
the threat is not bitcoin trading using bank accounts. the threat has nothing to do with bitcoin exchanges.
the real threat is where
bank notes (as paper) are cheaper than toilet paper. where people begin wiping their ass and flushing/destroying bank notes.
bank notes (as paper) are cheaper than home fireplace wood. where people begin burning bank notes to stay warm
literally destroying currency and taking it out of circulation.
that is a scenario unrelated to bitcoin.
also
the banks by law(regulation) cannot buy bitcoin.. so if you think the banks bought bitcoin simply to crash the market. then you are foolish.
even if banks were able to do this, guess what.. they are doing nothing more then handing funds they have to other people for themselves to lose out on.
banks want profits, they want trickle UP economics, not trickle down economics.
yes banks offer loans to pretend they are doing trickle down.. but they ask for 10x% back so its trickle up eventually.
also
banks know that dumping the price of another currency does not destroy it, it advertises it as a "discount day" of that outside currency, driving more people towards it while its cheaper.
yes inexperienced traders already holding the outside currency cry and panic. but experienced traders love the opportunity to double down and average out their holdings. experienced traders not yet holding love the opportunity to buy in cheap.
summary
all the PBOC were doing is stating a standard consumer risk memo that investments are risky and people can lose aswell as profit
this price drop has nothing to do with PBOC doing funny things maliciously. it is more than likely the exchange owner themselves taking advantage of the new AllTimeHigh a few days ago, to cash out to pay their bills.
But there were all kind of rumors when the correction happened. I heard on reddit that China was banning bitcoin, I also heard that Coinbase was hacked... a couple other more as well. And like you said all PBOC did was warm users of the volatility, and this caused the rumors and caused the crash, ironic isn't it. And no matter what, the price was growing too fast anyway and needed a correction, now the correction already happened and we will go back to 1k but slower.
