Bitcoin (BTC) price saw a sharp drop on May 21, with reports released that China reiterated its opinion on stopping mining and trading.
The never-ending issue: China and Bitcoin
According to data from Cointelegraph Markets and TradingView, the BTC / USD pair fell 10 percent within minutes on Friday, as bad news about cryptocurrencies increased in the mainstream media.
The pair dropped as low as $ 30,000 on Wednesday, followed by a record-breaking recovery, recovering $ 42,000. Some of the gains have disappeared after the recent news that caused concern.
Among the negative news was the Chinese government’s announcement of plans to “reduce Bitcoin mining and trading transactions and prevent individual risk steadfastly”.
As Cointelegraph reported, China has already reiterated its plans to control cryptocurrency activities within its jurisdiction, but media sources are commenting on the future of moves that will now pose a threat to the industry. As there were no official policy changes on Friday, the bad publicity about Bitcoin increased its impact.
China bans banks from doing business in #bitcoin. http://t.co/KLU7MWq4g1
— WIRED (@WIRED) December 6, 2013
Popular crypto commentator Whalepanda said, “Let China really ban Bitcoin transactions and mining.” answered.
“Mining will be more decentralized. There will be a black market for Bitcoin transactions and the perception that ‘China controls Bitcoin’ will disappear.”
Past research shows that the Bitcoin network is resistant to changes in external conditions and the loss of mining power is soon compensated in alternative regions.
Outside of China, regulators in Hong Kong are also planning to ban the use of individual cryptocurrencies “other than millionaires”.
After all these developments, while preparing for this news publication, Bitcoin started to recover from the bottom of $ 36,680.
Flexibility in the market is improving
Due to the negative news following the $ 30,000 drop, traders using excessive leverage withdrew and transactions slowed.
Because Tesla CEO Elon Musk sent on Thursday, criticizing Bitcoin’s energy consumption tweet‘i didn’t cause shock as much as last week.
Meanwhile, the popular Twitter account Documenting Bitcoin makes a telling about the consequences of the “FUD” trend spread by China. sent a message. The BTC / USD parity had seen the biggest increase in history after the apocalyptic scenario that the Beijing government had previously put forward.