Many Cryptocurrencies Suffered Tremendous Losses

Bitcoin and other cryptocurrencies declined amid an intensifying crypto crackdown in China. China’s battle against cryptocurrencies started a long time ago. Last week, the country moved in to shut down major crypto mines. Local mines power nearly 80% of the global trade in cryptocurrencies despite a domestic trading ban since 2017.

The price of Bitcoin fell to as low as $32,309. Bitcoin suffered serious losses in recent weeks partly because of China’s crackdown.

But in recent months several provinces ordered mines to close as the country turns a sharp eye to the industry. The province of Sichuan ordered the closure of mines last week. Sichuan is a major cryptocurrency hub, as it the second most intensive mining region in the country after Xinjiang. It is no secret that, cryptocurrency mining requires a lot of electricity. The crypto industry flourished in the province thanks to its cheap and abundant electricity. Chinese media reported that the electricity supply to all cryptocurrency mines across the region was stopped at midnight Sunday.

Separately, a Chinese city with abundant hydropower stepped up action to rein in cryptocurrency mining. A government official told that Ya’an promised to root out all Bitcoin and ether mining operations in 2021.

In May, the value of the world’s largest cryptocurrency fell due to three Chinese financial industry bodies. They reasserted a ban on financial institutions from offering cryptocurrency services.

China makes anti-cryptocurrency moves

This week China went hard again. The country turned the screw on crypto miners to stamp out financial risks from speculation. The crypto mines and their impact on the environment represent another factor. The world’s second-largest economy is in the midst of a wide-ranging regulatory crackdown on its fintech sector.

China’s central bank held talks with several major banks and payment institutions about crypto trading speculation. In fact, the People’s Bank of China asked them to screen the capital accounts of cryptocurrency exchanges and over-the-counter dealers and cut relevant payment links.

Lastly, the central bank reiterated that no banks or banking institutions are allowed to provide products and services to individuals who engage in cryptocurrency trading. The central bank added that it recently summoned banks and payment institutions. Representatives of the Industrial and Commercial Bank of China, and others to discuss crypto-related topics with the central bank. The country’s central bank stated that the virtual currency transaction activities disrupt normal economic and financial order.