Crypto market on fire after China heats up crackdown

Crypto Market On Fire

The world is red again! Bitcoin and friends are trading lower after the People’s Bank of China issued a notice calling for a stricter crackdown on virtual currency dealings.

Banks and financial institutions in the Asian country must stop providing trading, clearing, and settlement for crypto transactions. This obviously increased the negative sentiment in crypto markets, with many a coin wilting.

Bitcoin, for starters, is trading 10% lower near $31,850, extending its decline of 8.7% from last week.

Ether, the second largest cryptocurrency in existence, has gone under $2,000, and was last seen changing hands for $1,920 at press time. This makes for the lowest level since May 23 for the second largest cryptocurrency by market value.

The native token of the Ethereum blockchain is down nearly 15% on the day, making for an even steeper decline than the original crypto.

Other top cryptocurrencies are also in red, including the likes of XRP, Cardano, and Polkadot. They are nursing losses ranging from 5% to 10%. Dogecoin is in even deeper, with a 23% decline that has the memecoin going down to as low as $0.21 at press time.

Crypto markets are not new to all this volatility, of course. And they pretty much always climb back up in due time after the dust settles.

They tanked last month too, on the back of environmental concerns related to crypto mining. China’s crackdown and fears of an early scaling back of stimulus by the US Federal Reserve also weighed heavily on traders and investors.

The Fed unexpectedly brought forward the timing of the first interest rate hike to 2023. But this strongly worded communique from PBOC has bolstered concerns in the market that China is going the right way for a stricter regulatory crackdown.

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