SINGAPORE - Bitcoin went on a wild ride overnight amid a report by the Wall Street Journal that Chinese regulators are preparing the biggest clampdown on the virtual currency to date.

According to the Journal report on Monday (Sept 18), the regulators revealed to cryptocurrency executives on Friday during a private meeting in Beijing that the Chinese government is looking to put a halt to all bitcoin trading, including peer-to-peer or over-the-counter platforms that allow individual buyers and sellers to find each other on the internet and trade digital tokens.

This would be the most widescale attempt by any country to control the cryptocurrency, according to the Journal.

Earlier this month, Chinese regulators banned commercial exchanges trading bitcoins and other digital tokens. They also banned initial coin offerings at the beginning of the month as an illegal form of public financing.

Chinese regulators see bitcoin and other virtual currencies as a potential threat to the yuan, said the Journal. The regulatory crackdown also comes as China's top leaders battle money laundering, as the country prepares for a leadership transition this fall, said the report.

At the meeting last Friday, a document was passed around instructing exchanges based in Beijing to unwind their operations and provide information on bank accounts used for clients' deposits by Wednesday, said the Journal. Sources also told the paper mainland access to foreign bitcoin exchanges online like Coinbase in the US would also be blocked by China's Great Firewall.

Bitcoin, meanwhile, went its latest wild ride overnight. Its price bounced back by nearly US$1,000 to US$3,964 on Monday afternoon, recovering by 34 per cent from Friday's US$2,951, its lowest since early August.

Bitcoin lost about 14.7 per cent last week, extending a sharp drop since briefly topping US$5,000 in early September, on news of China's ban on bitcoin trading by domestic exchanges.