Crypto market tumbles after China’s central bank reaffirms crackdown
- The People’s Bank of China disclosed a continued crackdown on virtual currency transactions in a video conference.
- China’s central bank revealed that cryptocurrency transactions originating from the country had plunged 80%.
- The central bank’s crackdown on China is an effort to restore order in the domestic financial market.
- The overall cryptocurrency market capitalization has remained nearly unchanged over the past year.
In a video conference today, the People’s Bank of China has reaffirmed a continued crackdown on virtual currency transactions. Over the past year, the crypto market capitalization remained unchanged; however the Bitcoin price dropped 20%.
Bitcoin price tumbled 5% following China’s announcement
On March 1, 2022, the Central Bank of China reaffirmed its stance on the cryptocurrency ban. In a video conference, the People’s Bank of China said that the crackdown on virtual currency transactions would continue, going ahead in 2022.
The Central Bank revealed that since the ban on Bitcoin and cryptocurrencies, there had been an 80% drop in transactions originating from China. While before the ban, 90% of worldwide crypto transactions originated from China, the number dropped to 10%, the bank revealed in a video conference.
The People’s Bank of China announced a ban on crypto transactions and Bitcoin to restore order in the domestic financial markets. Cryptocurrency transactions were added to the illicit activities list that negatively impacts the economy.
China has assured that the crypto ban will remain in place, going into 2022. While the overall crypto market capitalization plunged below pre-ban levels, it has remained stable and is unchanged.
Bitcoin price suffered a 5% drop in response to the news of a continued ban in China. The asset’s price plunged below the 2021 level several times before recovering above $40,000. FXStreet analysts have evaluated the Bitcoin price trend and predicted that the asset is at risk of a drop to $35,000.
FXStreet analysts identified an Ichimoku Kumo Twist in the Bitcoin price daily chart, indicative of new swing highs and lows. Analysts believe that an Ichimoku Kumo Twist is coming up at the end of March 2022; the inference being that Bitcoin price could plummet.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
