As bitcoin prices plunge, bulls reassure themselves

“Pseudo-financial innovations that have no relationship with the real economy should not be supported.”

The words of Pan Gongsheng, Vice Governor of the Chinese Central Bank, are ringing loudly in cryptocurrency world’s ears Tuesday. In a memo outlining a discussion held between the various Chinese policymakers and regulators last week, Mr. Pan described a hard anti-cryptocurrency stance. “The financial work conference clearly called for limiting ‘innovations’ that deviate from the need of the real economy and escape regulation,” he said.

China-as-cryptocurrency-buzzkill is an established trope by this point, but the memo’s timing carries meaningful impact. It comes nearly simultaneously as commentaries from French finance minister Bruno Le Marie and the German Central Bank call for increased regulation of cryptocurrency.

As a result, bitcoin is down 20 percent in the past 24 hours and major altcoins are taking hits. So happy Tuesday!

The day’s events are being dissected and contextualized by the Reddit hivemind. Bitcoin has taken meaningful dips in the past, so the r/Cryptocurrency subreddit is not exactly in a state of abject panic and disorder. But there is a lot of rationalization and reinforcement going on.

Invoking Warren Buffet’s line about being greedy when others are fearful, one Redditor wrote that you’re buying post-crash bitcoin “if you’re smart.”

“This is why you hold,” posted another user, linking to a chart that puts “the January dip” in perspective.

Another raised the stat that bitcoin has “died” 235 times and counting so far.

r/Cryptocurrency’s daily discussion thread has the usual several thousand comments so far. Almost all of them address the day’s crash in some fashion, whether with humor (“THE DREAM IS COLLAPSING music intensifies”) or other observation (“Pretty weird how every time the Dow hits an all time high, crypto has a major crash”). The subreddit’s archived daily discussions of the past present themselves as a historic pulse of the cryptocurrency world. You get to read not only what cryptocurrency people were thinking about at that time, but how they felt about it as well.

Pan Gonsheng’s memo clearly expounds on China’s denouncement of cryptocurrency at large. But the collective tone of the crypto-hivemind is just as clear: “We’ll get through this.”