It’s been a very volatile ride for holders of Bitcoin recently. Bitcoin’s value right now is about four and half times as much as an ounce of gold. Back in 2013 enthusiasts were lucky to see bitcoin top $100. By the end of that year it was over $1000. In the beginning of this year, 2017, the virtual currency was trading at only $966. It remained on an upward trend until the end of the summer when it dropped below $3000 in September. Despite what has been a great year so far, bitcoin’s intense fluctuations are what scare many investors away. One factor affecting the roller coaster movement of digital currencies is increasing government bans around the world.

The price of Bitcoin is very sensitive to government crackdowns. The dip below $3000 in September was due to an announcement from China to begin enforcing a crackdown on bitcoin exchanges and a ban on initial coin offerings. Subsequently the Financial Services Commission of South Korea said all kinds of initial coin offerings will be banned in that country as well. “Stern penalties will be issued on financial institutions and any parties involved in issuing of ICOs,” says the regulator. Then most recently, the Russian government appears to be clamping down on bitcoin. Vladimir Putin, the Russian president, said in a conference that “virtual currencies arebecoming and have already become more popular. They have already become or are turning into a full-fledged payment instrument and an investment asset in certain countries. At the same time, use of cryptocurrenies also carries serious risks… We have seen how bitcoin has transformed a payment unit into an asset, which is bought in order to obtain a high yield in a short period of time. This is the definition of a pyramid.” Although China and South Korea have outright banned ICOs, Russia seems to want to suggest more moderate regulations. “It’s important not to set up superfluous barriers,” says Putin, “But to create the essential conditions for the further development and perfection of the national financial system.”