LONDON: Bitcoin dropped roughly 5% on Friday after China’s central bank said it would crack down on cryptocurrency trading and ban exchanges that provide services to mainland investors.
The largest cryptocurrency, Bitcoin, has been down 4.6% in the last 24 hours with other coins the following suit. Ethereum is down 8% while XRP is 7%.
The People’s Bank of China has said it will stop trading with Bitcoin, following news that it would bar financial institutions and payment companies from providing Bitcoin-related services.
These sudden dips in the crypto market are an indicator of how frail the market right now is. There’s a lot of panic among investors.
Crypto remains in a legal grey area across China.
It is understandable if people are feeling nervous about the market. The U.S. listed stocks of cryptocurrency and blockchain-related firms also took a hit, but we’re expecting them to recover given the immense potential this industry has and will continue to have in the near future, Marathon Digital and Bit Digital are down! Marathon Digital is at 4.1% while Bit Digital is at 5.1%. Meanwhile, China-focused SOS slipped 1.2% and crypto exchange Coinbase Global fell 2.7%.
Earlier this year, the Chinese authorities announced they would be cracking down on crypto mining for cryptocurrencies like Bitcoin. The announcement created a huge sell-off of crypto coins, which is understandable given the news.
Disclaimer: The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.