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Bitcoin drops to its lowest level in two weeks after China announced it summoned bank chiefs to reiterate the ban on providing cryptocurrency services.
By Joanna OssingerBloomberg
Bitcoin fell to a two-week low amid an intensifying crackdown on cryptocurrencies in China.
The largest virtual currency fell 10% to $ 32,350 at 8:50 a.m. in New York City. Ether fell 13% to $ 1,950.
China said on Monday it had summoned officials from its largest banks to a meeting to reiterate the ban on providing cryptocurrency services. This is the latest sign that China is planning to do everything in its power to close the gaps left in crypto trading.
Representatives of Industrial and Commercial Bank of China Ltd., Agricultural Bank of China Ltd. and payment service provider Alipay have received a reminder of rules prohibiting Chinese banks from engaging in crypto-related transactions, according to a central bank statement on Monday.
The PBOC crackdown goes further than originally intended, said Jonathan Cheesman, head of over-the-counter and institutional sales at the FTX crypto derivatives exchange. Mining was phase one and speculation is phase two.
In addition, a Chinese city with abundant hydroelectricity has stepped up its actions to curb mining. A Yaan government official told at least one Bitcoin miner that the city has promised to eradicate all Bitcoin and Ether mining operations within a year, a person with knowledge of the situation said.
As a backdrop, appetite for risky assets waned after the Federal Reserve’s hawkish policy pivot last week. Even though the stock markets swung into the green on Monday, analysts pointed to the lingering nervousness in the sparkling corners of the market.
If, as I expect, the global buy-all easing continues this week, Bitcoin will feel those cold winds, said Jeffrey Halley, senior market analyst at Oanda Asia Pacific Pte.
With the help of Li Liu.
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