Bitcoin extended Friday's tumble amid concern China will

tighten rules on the digital currency to curb capital outflows.

The cryptocurrency slid 1.4 percent to $888 at 5:43 p.m. in Hong Kong, after falling as much as 10 percent on Friday. The People's Bank of China's Shanghai branch said in a statement late Friday that its officials, along with the city's financial office, asked bitcoin trading platform BTCChina.com to conduct self-checks and rectify any problems. The State Administration of Foreign Exchange has scrutinized some major bitcoin exchanges, possibly to investigate the use of the digital asset to evade capital controls, QQ.com reported.

Bitcoin rallied since early 2015 as Chinese buyers turned to alternative assets to hedge against the weakening yuan and take cash out of the nation. By buying bitcoin onshore and selling it offshore for another currency, investors can evade the tightening scrutiny on fund outflows. Other than a ban on financial institutions' involvement, Chinese regulators had largely taken a hands-off approach on the cryptocurrency.