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Top line
China’s cryptocurrency crackdown, which blew markets up last month, intensified on Wednesday with another province ordering the shutdown of all cryptocurrency mining operations just hours after companies Popular internet have started censoring searches for three of the country’s biggest crypto exchanges, but bitcoin prices are skyrocketing after El Salvador’s historic adoption measure hoping other countries will follow suit.
Beyond Chinese regulatory concerns, bitcoin prices rise 15% on Wednesday in a historic context … [+] adoption in El Salvador.
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China’s Qinghai on Wednesday became at least the third province in the country to take action to curb cryptocurrency mining operations over environmental concerns, barring local authorities from setting up or authorizing projects. cryptocurrency mining and directing them to notify the provincial government of the implementation measures by June 20.
In its announcement, the province said it would conduct follow-up inspections at randomly selected supercomputing centers to ensure compliance and punish anyone violating the ban.
The move came after early morning reports that Baidu, the country’s most popular search engine, and social media site Weibo began blocking searches for cryptocurrency exchanges OKEx, Huobi and Binance, which is the largest in the world in terms of volume.
Based on applicable laws and regulations, the results of this search are not available, ”users said when searching for one of the exchanges on Weibo.
Despite Chinese regulatory concerns that caused crypto markets to collapse last month, tokens rallied broadly on Wednesday afternoon as bitcoin prices climbed 12% in the past 24 hours as investors hailed El Salvador’s successful vote to make the world’s largest token a form of legal tender.
Crucial quote
“Some bigger and more powerful countries are trying to undo or slow down the inevitable move to digital currencies without borders, but this small Central American country has adopted the bigger one,” Nigel Green, CEO of the adviser. $ 12 billion DeVere Group estate. , wrote in a note on Wednesday. “El Salvador has made history, and we can expect other developing countries to follow.” Other Latin American countries have already signaled their support for similar adoption measures
Key context
Chinese authorities raised concerns last month that sent the crypto market crashing down, with a slew of warnings targeting trading and mining. On May 18, three Chinese industry groups overseeing the financial sector announced that the country would clamp down on financial institutions operating in cryptocurrency or offering related services in light of market volatility, claiming that digital tokens had failed. “no real support value” and prices that are “extremely easy” to manipulate. The following week, Beijing said it would “focus on bitcoin mining and trading activity” to achieve financial stability by curbing the spread of cryptocurrencies. In addition to Qinghai, two other provinces of Inner Mongolia and Sichuan have since announced policies to curb or ban mining. Markets plunged about 30% amid the warnings and have since gained about 15%.
Tangent
The cryptocurrency market collapsed by more than 10% in mid-April after power outages in China led to a massive drop in bitcoin mining rates, which experts say are correlated at prices. Those rates have since recovered, but about 75% of global mining occurs in China, meaning widespread bans could shake the market again.
Further reading
El Salvador makes history as the first country in the world to make bitcoin legal (Forbes)
China clamps down on crypto trading, says ‘speculative’ trading ‘seriously violates’ financial order (Forbes)
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