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Bitcoin slumps further as China tightens crypto crackdown

ForexJun 21, 2021 23:30
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2/2 © Reuters. A representation of the virtual cryptocurrency Bitcoin is seen in this picture illustration taken June 14, 2021. REUTERS/Edgar Su/Illustration 2/2

By Tom Wilson, Kevin Buckland and Gertrude Chavez-Dreyfuss

LONDON/NEW YORK/TOKYO (Reuters) - Bitcoin tumbled on Monday to a two-week low on China's expanding crackdown on bitcoin mining, as investors grew more uncertain about the future of the leading cryptocurrency.

Bitcoin fell as low as $31,333, a two-week trough, dragging down other cryptocurrencies. It was last down 10.7%, its largest daily percentage loss in a month.

The world's biggest cryptocurrency has lost more than 20% in the last six days alone and was at half its April peak of almost $65,000. Year to date, it remained up about 11%.

Some bitcoin investors were concerned further losses could be in store due to a chart formation known as a death cross which occurs when a short-term average trendline crosses below a long-term average trendline.

China has been tightening its crackdown on cryptocurrencies. On Friday, authorities in the southwest province of Sichuan ordered bitcoin mining projects to close.

Last month the State Council, China's cabinet, vowed to clamp down on mining and trading as part of a campaign to control financial risks.

On Monday, China's central bank said it recently summoned some banks and payment firms, including China Construction Bank and Alipay, urging them to crack down harder on cryptocurrency trading.

"People still react strongly to actions from China that create uncertainty so this is likely to reflect negatively on the bitcoin price," said Ruud Feltkamp, chief executive officer at at crypto trading bot Cryptohopper.

"China is rolling its own cryptocurrency and has every incentive to have as little competition as possible...I think we will see miners leaving China and relocate where there is spare or cheap energy."

Data on mining is scarce. Yet bitcoin in China accounted last year for about 65% of global production, according to data from the University of Cambridge, with Sichuan its second-biggest producer.

Agricultural Bank of China (AgBank), China's third-largest lender by assets, said separately it was following the People's Bank of China's guidance and would conduct due diligence on clients to root out illegal activities involving crypto mining and transactions.

Alipay, the ubiquitous payment platform owned by fintech giant Ant Group, said in a separate statement it would set up a regulator monitoring system targeting key websites and accounts to detect illegal crypto-related transactions.

In other cryptocurrencies, ether, the token used for the Ethereum blockchain, dropped to a five-week low of $1,890. It was last down 14.3% at $1,922.05.

Also on Monday, auction house Sotheby's announced that a rare pear-shaped diamond that is expected to fetch up to $15 million can be bought at an auction next month using cryptocurrencies. It would be the first time a diamond of such size has been offered for public purchase with cryptocurrency.

Bitcoin slumps further as China tightens crypto crackdown
 

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Comments (5)
Joe Yee
Joe Yee Jun 22, 2021 4:51
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Mr Tan well said Yes God is for sure is watching …..
Tan Buck Siang
Tan Buck Siang Jun 22, 2021 1:16
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God is watching. ppl do evil thing will be punished and have they judgement day to come very soon.
Zafirin Saleh
Zafirin Saleh Jun 22, 2021 0:09
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why always china
Brendon Wendy
Brendon Wendy Jun 22, 2021 0:09
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China was the major Asia coin holder market in Cryptocurrency. if anything happen to Cryptocurrency market will effect the country GDP and Financial system. some more crypto was a investment game that no secure protection from any Authority like Bank or SEC, some more crypto was a convenience tool for black market money/ criminal activities money to keep their profit clean because Crypto is aynonymous
chris escobar
chris escobar Jun 21, 2021 20:23
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greatest con of all time.completely useless as currency.speculator's dream,nothing more.
Joe Baranyi
Joe Baranyi Jun 21, 2021 9:08
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Maybe it is just me but it does not makes sense. If they close down mines the supply of new coins will drop which should drive up demand...?
Winfred OforiAnnor
Winfred OforiAnnor Jun 21, 2021 9:08
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cryptocurrency is not as susceptible to supply and demand as commodities such as oil. The main catalyst for a rally in crypto price is more due to its technology risks and aims and what the actual cryto coin aims to achieve. This is why bircoin fell because the future of the coin is in question because of China targeting the miners.
Brendon Wendy
Brendon Wendy Jun 21, 2021 9:08
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And this no control by Government / Authourity , is the Whale Holder / Instituition sell off all coin, the price may drop until Zero. example TITAN COIN from 65 drop until Zero cent.
 
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