China’s recent unprecedented crackdown on cryptocurrency-related activities is expected to create uncertainty for companies exposed to blockchain and cryptocurrencies. This is due to the fact that China accounts for the majority of crypto mining worldwide. Hence, it might be best to avoid stocks such as Riot Blockchain (NASDAQ:RIOT), Canaan Inc. (CAN), and Ebang International Holdings (EBON) now.Amid fading investor interest in cryptocurrency, China’s central bank recently declared all cryptocurrency-related activities illegal. After the intensified crackdown, the most popular cryptocurrency, bitcoin, lost 5% on Friday, and the second-largest virtual currency, Ether, declined 7%.
Earlier this year, China announced a crackdown on crypto mining. The major actions against cryptocurrencies taken by China accounted for about 47% of all crypto mining in April.
Due to these concerns, shares of companies significantly exposed to digital currencies might see a pullback in the near term. That is why Stocks such as Riot Blockchain, Inc. (RIOT), Canaan Inc. (CAN), and Ebang International Holdings Inc. (EBON)are best avoided now.