Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Bitcoin Tumbles As China Issues Yet Another Threat

Published 05/23/2021, 01:20 AM
Updated 05/08/2020, 11:50 AM

Another warning from China sends cryptocurrency prices into the red.

Key Takeaways

  • Bitcoin and the rest of the crypto market turned negative on Saturday as news of China's regulatory crackdown surfaced.
  • The government issued a statement pledging to introduce tighter crypto regulations.
  • The Inner Mongolian province has also announced a whistleblower program for reporting on BTC miners.

Bitcoin investors have panicked for a third consecutive day, sending the asset 12% into the red. Saturday, it was because China has sent out another warning to the crypto industry, specifically targeting miners.

China Issues Another Warning

Bitcoin’s week of negative trends continues.

At 10:10 am EST Friday, reports that the Chinese Vice Premier, second to the President, Liu He, had vowed to curb the mining business in the country jolted the cryptocurrency market.

He hosted a meeting with China’s state council, after which a statement calling for a crackdown was posted on the Chinese government’s website.

Yesterday was the third consecutive day where the market saw flash crashes driven by regulatory news.

Bitcoin suffered its worst dip since March 2020 on Wednesday, as the news that China would increase its oversight on crypto trading helped the asset hit lows of around $30,000.

The U.S. Treasury then announced its plans to make crypto users report transactions worth over $10,000 to the IRS. If implemented, the ruling would begin in 2023. Bitcoin dipped 8% from $41,500 to $38,100 within an hour of the news breaking.

The astronomical price rises of cryptocurrencies like Bitcoin have recently led to increased government oversight of the space worldwide.

Reports of China ramping up efforts to curb the crypto market have been coming all week. Local authorities have also attempted to introduce new checks on trading and mining.

China is known for its opaque approach to cryptocurrencies; in previous bull cycles, regulatory fears over China enforcing a Bitcoin ban have sent the market into panic.

Prior to Saturday's announcement, the Financial Times reported on Friday that the Inner Mongolian province, which announced a ban on Bitcoin mining last month, had set up a dedicated whistleblower hotline to “comprehensively clean up and shut down” mining operations in the region.

The region houses around 7% of the country’s Bitcoin mining operation and is especially busy during the dry season.

In addition to the He update, Hong Kong, the special administrative region of China, also reiterated its legislative proposal that will allow only professional traders with a portfolio of over HK$8 million ($1.03 million) to trade on licensed cryptocurrency exchanges.

At time of writing, Bitcoin was last trading at $37,300 on Bitstamp. The second-largest cryptocurrency Ethereum was down 11.3% to lows of $2,450. The losses across other altcoins were more severe, down in double-digit percentages.

Original Post

Latest comments

Same old news??
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.