The announcements that the Chinese government issued seem to affect the price of the main cryptocurrency on the market. This is a crucial time when the price of Bitcoin could take a decisive turn.
In recent days, the Chinese government said that it would take strong measures against the mining and trading of Bitcoin, according to Reuters. Within hours of that announcement, the price of the pioneering cryptocurrency dropped.
This seems to be another media campaign by the Chinese authorities against Bitcoin, with which they could hurt the price of the crypto asset.
According to the same source, the Chinese government committee reported that Vice Premier Liu He chaired a meeting about this issue. He said that the intention of these measures is “to maintain the stability of the stock, bond and currency markets” of the country.
Before China issued that statement, the United States announced that the Treasury Department was calling on stricter compliance with the Internal Revenue Service (IRS). According to the Treasury Department, these types of assets represent a risk of tax evasion.
China’s Announcement Caused the Price of Bitcoin to Drop
A Tradingview chart shows an ascending triangle formation, that is, the price of Bitcoin is bouncing between a triangular pattern with the tip upwards. When it seemed as if the price of the crypto asset would have a “V”-like recovery, the news about China appeared. That may have caused the price of Bitcoin to go down.
The price of the pioneering cryptocurrency is plummeting along with that of other crypto assets such as Ethereum and Dogecoin. Bitcoin has fallen by more than 21%, but the worst has happened to Ethereum (with 31%), Dogecoin (with 42%), and Shiba (with 48%). The latter two cryptocurrencies, in particular, have lost almost half of their value.
Other Campaigns by China Against Bitcoin and Other Cryptocurrencies
It is not the first time that the Chinese government has conducted a media campaign against the pioneering cryptocurrency. In recent days, they prohibited financial institutions and payment companies from providing services related to cryptocurrency transactions.
In 2013, China banned banks from conducting transactions with Bitcoin and other cryptocurrencies. In 2014, the government pressured China’s online shopping platform Taobao to ban sales of Bitcoin. In 2017, China said that it was ready to ban Bitcoin and cryptocurrency exchanges.
In 2017, the Central Bank of China announced a ban on Initial Coin Offerings (ICOs). The People’s Bank of China also threatened to impose sanctions against those who violated this official law.
The following year, they even banned events, such as conferences, talks, and forums, related to cryptocurrencies like Bitcoin. In this regard, they issued a statement informing that no one could use hotels, shopping centers and offices for these commercial activities.
The Asian country’s relationship with the pioneering cryptocurrency has been tense but they have been more flexible about mining. However, they are starting to introduce new regulations on this activity in provinces like Inner Mongolia.
By Alexander Salazar
