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

In recent days, Bitcoin’s dominance in the market fell below 40%. Only Bitcoin and Ether have 60% of the total value of the cryptocurrency market.

The cryptocurrency market has suffered a very steep decline in recent days. The value of Bitcoin has fallen by around 20% in a week and its total market capitalization returned below USD 1 trillion. Besides, the market capitalization of cryptocurrencies in general fell from USD 2 trillion. However, Bitcoin has regained some of the dominance that it had lost, amid the market’s red numbers.

Bitcoin’s market capitalization once again approached 45% of the total value of the market, after approaching all-time lows of dominance, according to data from CoinMarketCap. In other words, altcoins have suffered the most during the current situation of the market despite the crash in the pioneering cryptocurrency’s price.

Most major altcoins have lost a larger percentage than Bitcoin in the last week, according to the same source. Polkadot (DOT), Internet Computer (ICP) and EOS, among others, have suffered drops close to 50% in that period.

Solana is the only cryptocurrency in the top 30 that has experienced a decrease in its price below 10% in 7 days. Meanwhile, the average depreciation of cryptocurrencies is around 35%, taking into account those with higher market capitalization.

At the beginning of May, a handful of cryptocurrencies had the total value of the market, despite the existence of more than 9,500 crypto assets.

CoinMarketCap currently reflects that there are more than 10,000 cryptocurrencies on the market. However, almost half of the total value corresponds to the first cryptocurrency. When adding Ether (ETH), Ethereum’s native cryptocurrency, only two cryptocurrencies have more than 60% of the market.

“Altcoin Season” Suffers a Steep Fall

Bitcoin had been steadily losing dominance before the general crash of the cryptocurrency market on May 19^th. Just a day earlier, the dominance of the pioneering cryptocurrency was below 40%, but it rose rapidly the next day.

At the time, the market was clearly in the so-called “altcoin season” as most major cryptocurrencies had better returns than Bitcoin.

After the general crash of the market, there now seems to be a reversal of that situation. The altcoin season, measured by percentage records of the top 50 over three months, remains. However, in a 30-day range, most altcoins no longer outperform Bitcoin, according to data from blockchaincenter.net.

The price of the first cryptocurrency is almost 50% below the all-time high above USD 64,000 that it reached in mid-April. However, some cryptocurrency market analysts believe that the bullish cycle is not over yet. They hope that Bitcoin will recover, but it will not be a quick process as it could take months, according to Willy Woo.

Despite the severe sell-off that the current market crash has caused, there is still speculation about whether it would stop the bullish market. Some consider that this cleansing or correction should have occurred before and predict a price of thousands of US dollars per unit.

By Alexander Salazar

The renowned American economist named the main cryptocurrency “digital gold.” Although he does not see a complete adoption coming in the future, he does believe that this technology is endurable.

Lawrence Summers, former US Secretary of the Treasury from 1995 to 1999 and former director of the National Economic Council from 2009 to 2010 said in an interview that bitcoin (BTC) might end up being critical for e-commerce. Also, he stated that “cryptocurrencies are here to stay” and that they will play important roles in the system for quite some time.

In a television interview that took place in Bloomberg, the former director of the World Bank stated that there is a long-standing human desire to own an asset that can look like an alien to the day-to-day agenda of governments.

In that sense, the secretary also added that gold has served as the primary asset of this type for quite a long time while qualifying cryptocurrencies as digital gold and assured that they have a chance to become a consensual way of preserving wealth.

Regarding the future of cryptocurrencies, Summers said that if cryptocurrencies reached half or even a third, the value of gold, these currencies would go through a greater appreciation from current levels.  This position would lead them, according to a general criterion, to remain working in the system for a longer time.

He also led his omens about crypto assets to context by putting on hold situation, he doubts that in the future most payments using bitcoin or cryptocurrencies will lead to a ‘libertarian paradise’, instead they will become essential for the online market.

The Treasury Department’s improvements

Lawrence Summers, a prestigious American economist who is currently a professor at Charles W. Eliot University, President Emeritus of Harvard University. Beyond Summers Ideas today’s President the United States Department of the Treasury has a position that aims at a stricter regulation of cryptocurrencies.

This latter entity is even training people to investigate bitcoin addresses. The measures intend to learn more about people on the blacklists related to terrorist activities, drug trafficking, and other criminal activities.

Janet Yellen, on the other hand, has shown a change of mind which favors cryptocurrencies and their community more than a while ago.  In some of her speeches during 2021 she had shown a more flexible position towards cryptocurrencies, she has stated that she will advocate for legitimate use of these new technologies.

These statements are surprising because in her previous position as chair of the Federal Reserve, specifically in December 2017, she spoke about bitcoin as a “highly speculative” asset.

In addition, the professor of economics, who was recognized at the time as the second most powerful woman in the world, recalled at that moment that Bitcoin was not a legal tender in any country or the world.

By: Jenson Nuñez

The central bank will set supervision to 10 of the submitted projects. Solutions with blockchains and digital identity also received the go-ahead.

The General Secretariat of the Treasury and International Financing of Spain announced that 18 fintech projects, 9 of them related to cryptocurrencies and blockchains, received official authorization to take part in the first edition of the regulatory sandbox. Selected initiatives include platforms for payment with crypto assets, digital identity, and solutions based on distributed ledgers.

The first call received in February a total of 67 proposals that seek to make the local financial sector evolve. After weeks of analysis, only 18 projects were admitted, that is, 27% of all initiatives.

These solutions will now go to the testing process, in which they will receive supervision from regulators who will approve their operation under established financial standards. The Bank of Spain will coordinate 10 projects, the National Securities Market Commission (CNMV) another 4, and the General Directorate of Insurance and Pension Funds the rest.

The secretariat explained in a statement that the projects must comply with current regulations on the prevention of money laundering and terrorist financing, as well as on the protection of financial services clients. The entity also recalled that the proposals must comply with current regulations in the case of working with the personal data of users.

Cryptocurrencies and Financial Improvements in Spain

The favored proposals related to the environment of cryptocurrencies, tokens, and blockchains were: Eurocoinpay, a platform to drive payments with digital assets; Realfund, a project that focuses its efforts on the tokenization of real estate and Dalion, a digital identity solution on distributed registries.

The project called “Issuance and custody of tokenized shares of an investment fund”, belonging to the Onyze consortium, Renta 4, Allfunds Blockchain, and IoBuilders also received approval. Another proposal from Santander bank called “Digital custody on blockchain” will also be supervised by the regulatory authorities.

Four other initiatives such as those of Lithium 100, Vottum-Intercompany, MarketPlace, and the Intelligent Death Insurance, also use blockchains for their proposals and were favored. Now all projects must establish guidelines, in the company of their supervisory entities and define what will be the protocol for evaluations.

Spain Approves Technologic Innovation

In February of last year, Spain approved the regulatory sandbox for fintech innovations. Since then, startups in the sector have been looking for submitting their projects and receive their proper evaluation to pass the tests and receive certification to offer their services under a regulated environment.

Now startups that offer capital market financial services, products related to insurers, means of payments, personal finance, loans, blockchains, or cryptocurrencies, among others, will have a regulated testbed to improve their services before its appearance in the market, just in case of complying with the established regulations.

Space will depend on and will be coordinated by the General Secretariat of the Treasury and International Financing but the Bank of Spain, the National Securities Market Commission (CNMV), and the General Directorate of Insurance and Pension Funds will also participate in its management.

By: Jenson Nuñez