Chinese crackdown leads to crypto collapse

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Trade on major cryptocurrency exchanges fell more than 40% in June, in part thanks to tighter regulations in China, new research shows.

As Reuters reported on Monday, July 12, citing figures from London researcher CryptoCompare, spot trading volumes fell 42.7% to $ 2.7 trillion, while derivatives volumes fell 40, 7% to $ 3.2 trillion.

The headwinds continued as China persisted in its crackdown on bitcoin mining, CryptoCompare said. Due to both falling prices and volatility, spot volumes have declined.

The world’s largest cryptocurrency, bitcoin, fell more than 6% in June, its lowest level in January, as Chinese regulators imposed tighter restrictions on bitcoin mining and trading. These regulations were first launched in May, causing bitcoin to drop 35%.

Binance, a major crypto exchange that has been scrutinized by regulators around the world, has maintained its position as the largest platform in terms of spot trading volume, Reuters reported. Nonetheless, its volumes fell 56% last month to $ 668 billion.

This news comes at a time when China is stepping up efforts to launch a digital currency. As PYMNTS reported on Monday, the country has hosted trials for a central bank digital currency (CBDC) in cities like Suzhou, Chengdu and Shenzhen, and is now focusing on places like Beijing and Shanghai. So far, the country has distributed a total of $ 41.5 million in digital yuan.

The project, first announced in 2014, also included testing in Hong Kong, with digital yuan distributed to people in red envelopes.

Red envelopes are linked to a tradition in China of giving such envelopes to children, family members, friends and colleagues as a way to wish them good luck. In China, the color red is often associated with happiness and vitality.

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NEW PYMNTS DATA: LOYALTY STUDY FOR SMALL BUSINESS – UNITED KINGDOM EDITION

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