All about crypto-currencies in 2021!!
Bitcoin and other digital currencies tumble following China’s central bank veto. All the details
Cryptocurrency prices slid after China’s central bank (CBC) vetoed all digital currency transactions, promising tough measures on the markets.
Bitcoin fell 3.62% lower at $42,367.8, with a weekly decline of 9.75%.
Smaller cryptocurrencies, which typically rise and fall in tandem with bitcoin, also fell.
Ethereum also came under pressure, falling 7.44% to $2,880.08, losing 16.94% on a weekly basis.
This is not the first time China has been tough on cryptocurrencies. Earlier this year, Beijing announced a crackdown on cryptocurrency mining, Cnbc recalls.
The Pboc had previously ordered banks and non-bank payment institutions such as Ant Group (fintech from Chinese giant Alibaba) not to provide services related to cryptocurrencies.
And for a country that is closing to cryptocurrencies, there is also one that is opening up. Like Laos. This week, the Southeast Asian country allowed cryptocurrency mining and trading, part of a policy shift aimed at capitalizing on a crackdown on currency mining digital by China.
Not to mention the recent arrival of a social network in crypto-currencies. Twitter that will allow users to use bitcoins for its advice service.
All the details.
The Chinese Central Bank’s Decision
The People’s Bank of China (Pboc) said that services offering trading, matching orders, issuing tokens and derivatives for virtual currencies are strictly prohibited.
Overseas cryptocurrency exchanges providing services in mainland China are also illegal, the Pboc pointed out.
The Chinese institute also added that workers at foreign cryptocurrency exchanges will be investigated.
The move comes after China’s State Council vowed in May to clamp down on bitcoin mining and trading as part of efforts to tackle financial risk, triggering a major cryptocurrency sell-off.
The impact on crypto stocks
And today, news from Beijing hit bitcoin and other digital currencies, putting cryptocurrency and blockchain-related stocks under pressure.
According to data from Coin Metrics, the price of bitcoin fell more than 3% on a 24-hour basis, last trading at around $42,239. Ethereum, the second-largest digital asset, fell 7% to $2,860. XRP (-7%) and Cardano (-3.7%) are also down.
Stocks with heavy exposure to cryptocurrencies also fell in premarket trading, with Coinbase down almost 4%, MicroStrategy down 5% and Riot Blockchain down more than 6%.
The opening of Laos to shipping digital currency
The Chinese crackdown on cryptocurrencies, which had benefited from two major news this week.
Laos has allowed mining and trading operations on its territory, contradicting the policies of its central bank, which had issued warnings against cryptocurrencies only a month earlier. The move comes as the small Asian nation tries to find other sources of income to deal with the consequences of the Covid-19 pandemic.
The Prime Minister’s Office said six companies are now licensed to conduct cryptocurrency-related activities in the country. The government would now begin to work on regulating these activities. Laos could also seek to attract some of the miners driven out of China, as it is a close substitute that can also offer a large amount of cheap hydroelectric power that is currently not being used to its full potential.
THE TWITTER MOVEMENT
Finally, Twitter has opened up to bitcoin. The social network founded by Jack Dorsey will allow users to pay using cryptocurrency. In detail, Twitter has launched its advice service globally, that is, the advice it can send for free to users who activate the service. The company introduced tips on a trial basis in May to help creators earn payments from them for content they post on Twitter.
Bitcoin tipping is facilitated by Strike, a bitcoin wallet app that runs on the Lightning Network protocol. Lightning is designed to enable faster and cheaper bitcoin transactions. The company behind Lightning received funding from Twitter CEO Jack Dorsey, a staunch bitcoin supporter who tweeted in June that it was “only a matter of time” before Twitter took over. payments via the protocol, recalls The Verge.