Cryptocurrency: Why China May Be The Reason Cryptocurrencies Are In Crisis

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It seems that a multitude of negative stories have led to a cryptocurrency slump. According to a CNBC report, the trade values ​​of some of the biggest exchanges fell 40% in June. The report cites data from CryptoCompare, a data provider in the crypto market, which suggests that trading volumes at Binance, Kraken, Coinbase and Bitstamp have declined due to falling prices and lower volatility. . The report says the price of Bitcoin fell 6% and hit a monthly low of $ 28,908. The Chinese Factor in Cryptocurrency According to a Reuters report, China has tried to crack down on the crypto industry. And it looks like it’s finally made an impact. Fear of a Chinese crackdown may have led to fear in the market, which is why it found itself in a crisis situation. China is preparing to launch its own state-backed digital currency. This has led to the closure of mining operations in the country. Almost 50% of bitcoin mining power was hosted by these operators in China. The Chinese government announced tighter cryptocurrency restrictions in May. A Nikkei report says mining is an energy-intensive process that is not in line with China’s commitment to achieve carbon neutrality by 2060. China’s crackdown on bitcoin as well as mining crypto have forced many people to use powerful computers to secure bitcoin. network and validate transactions out of the country to other places like Kazakhstan, among others. Bitcoin’s hash rate, a metric to verify the computing power used by the bitcoin network, has fallen to a 13-month low in recent weeks, according to a Forbes report. It wasn’t just the bitcoin network that crashed. The other most popular Ethereum crypto network has seen its hash rate drop 20% in the past two months.

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