Bitcoin crash: China’s crackdown was ‘final nail’ in BTC’s bull run – price reacts to ban

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Bitcoin prices have tumbled to an all-month low on Monday, sparking fears of an imminent bear run. BTC prices are down nearly 10 percent in the last 24 hours, with the latest Coindesk data at the time of writing pricing the flagship crypto at £21,417 ($29,798). Bitcoin’s falling prices come amid China’s clampdown on bitcoin and cryptocurrencies.

On Friday, June 18, Chinese authorities announced a crackdown on bitcoin mining in the state of Sichuan.

And earlier last month officials said they would take crypto trading head-on in a bid to get a firm grasp on China’s finances.

Further adding fuel to the fire, China’s central bank said on Monday companies including payment platform Alipay have been urged to clamp down on crypto trading.

The news comes in stark contrast to El Salvador voting to make BTC legal tender.

Tim Frost, the CEO of fintech app Yield App, has now said China’s meddling with the crypto markets has put a stopper in bitcoin’s race to the top.

Earlier in mid-April, BTC struck gold at an all-time high price of £46,660.71 ($64,829.14).

But the digital currency has struggled to keep the momentum going, promptly tumbling below 28,746 ($40,000) before the end of May.

As of 3.52pm BST on June 22, BTC is still up 2.08 percent on its closing price last year, but there is a lot of uncertainty over where the token is now headed.

Mr Frost said: “It’s been an unpleasant start to the week for bitcoin, with the flagship cryptocurrency barely holding its ground above $32,000 after the Chinese government seemingly put the final nail in the bull run by effectively banning Chinese banks from servicing anyone that has ever transacted in cryptocurrency.

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“It’s always interesting that these institutions don’t seem to cite the same concerns when it comes to allowing their customers to gamble their savings away at a racetrack, but that’s an issue for the regulators.”

According to Coindesk data, bitcoin’s crash below the £21,559 ($30,000) support level marks BTC’s lowest price since January 28.

Government officials and tech entrepreneurs have expressed concerns in recent months about the potential impact bitcoin mining has on the environment.

South African billionaire and SpaceX CEO Elon Musk, for instance, pulled the plug on bitcoin transactions at his electric car company Tesla in May, citing his concerns about “rapidly increasing use of fossil fuels for bitcoin mining and transactions”.

The news, which was announced via Twitter, caused a stir on the markets and bitcoin prices fell by nearly 20 percent.

In the wake of China’s crackdown on bitcoin, Mr Frost has urged crypto traders to sit tight and weather the storm.

He said: “It may be that we are reaching an inflexion point with regulators and crypto.

“It seems many have finally realized how powerful and popular this asset class is, yet rather than try to understand and regulate it effectively with forward-thinking policies, they are reacting in fear with bans.

“This, added to the general downward sentiment, seems to be indicating a full-on bear market from here.

“Sensible investors would do well to find a solid passive income opportunity for their crypto while they sit back and ride out the storm.”

Bitcoin, as all cryptocurrencies tend to be, is an incredibly volatile asset that is not guaranteed to bring you a profit.

If you have ever considered buying bitcoin or any other digital currencies, you do so at your own risk.

Here in the UK, the Financial Conduct Authority (FCA) has warned cryptocurrencies are an all-risk and extremely volatile investment.

The FCA said: “If you invest in cryptoassets, you should be prepared to lose all your money.”

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