Bitcoin dove even further on Tuesday, finding itself just below $30,000 since January following China’s intensive and rapid repression of cryptocurrencies.
The crypto giant which had remained as an industry leader, has lost about half of its value ever since it hit its record-breaking high last April.
The price volatility in cryptocurrencies has taken no exception as other key players such as Ethereum and Dogecoin fell at 14% and 26%, respectively.
Plummeting prices and shares were sustained over the past couple of months with critical environmental issues arising in relation to bitcoin and other cryptocurrencies’ energy usage.
Criticism from prominent investors like Elon Musk, founder and CEO of Tesla, influenced Bitcoin investors.
On the day Musk tweeted his dissatisfaction with Bitcoin’s lack of clean approach to the mining process and transactions involving the cryptocurrency, the price of Bitcoin dove. On top of those tweets, Musk also announced that Tesla would no longer accept bitcoin as a payment option for the company’s vehicle sales.
Looking closely into the volatility of cryptocurrencies, analysts are projecting significant loss within key players as an entire country restricted cryptocurrencies.
China’s views on cryptocurrency
China shared several negative perceptions against Bitcoin with the likes of Warren Buffet. In 2013, Chinese regulators declared cryptocurrency is “not a real currency.”
They imposed full restrictions on the use of cryptocurrencies for transaction purposes within financial and payment institutions. They also expressed their absolute apprehension that Bitcoin could be used for illegal financial activities like money laundering.
However, as bitcoin became more popular over the years, China’s perception of bitcoin remains unscathed. China’s central bank stated that “Cryptocurrency trading and speculative activities breed the risks of illegal cross-border transfers of assets and money laundering.”
Crypto transactions became the big No-No
On Monday, the People’s Bank of China gathered the country’s big lenders to investigate crypto trading activities comprehensively.
The meetings sent a strong message that the Chinese government will no longer tolerate cryptocurrency exchange and transactions.
The lenders who were summoned are Alipay, a renowned online payment company run by Jack Ma’s Ant Group, Industrial and Commercial Bank (IDCBY), the Agricultural Bank of China, the Postal Savings Bank of China, China Construction Bank (CICHF), and the Industrial Bank.
Following the central bank’s announcement on its firm stance against cryptocurrency activities, all the companies mentioned above released their individual statements that their platforms will reinforce the ban on using any crypto-related activities carried out by institutions or individuals.
If the announcement was not enough to send the message that cryptocurrencies are a no-no in China, Sichuan, a southwestern Chinese province, released an order stopping crypto mining operations and going as far as cutting off the power supply of several mining facilities.
Sichuan is a hotspot for crypto mining that involves using specialized computers to solve complex mathematical problems that will generate the cryptocurrency and verify transactions.
The aggressive actions of China against cryptocurrencies have shaken several investment firms and crypto traders. Nonetheless, a significant percentage of investors still trust that bitcoin and other cryptocurrencies will eventually find their place in the financial realm.