Bitcoin drops below $4000 amid China's OTC ban

Bitcoin suffered heavy losses on Wednesday after Bitkan, China's biggest OTC trading service provider for digital currencies, said that it decided to suspend its over-the-counter (OTC) bitcoin and bitcoin cash trading services starting Thursday. South China Morning Post, a Chinese media outlet, reported that Bitkan’s announcement followed the Chinese central bank’s recent decision to ban fundraising through digital currencies, branding it as illegal. 

The BTC/USD pair lost more than 7% during the day and is now trading at $3484. Yesterday, Jamie Dimon, the CEO of JP Morgen, claimed that bitcoin was a fraud and would eventually blow up. Furthermore, India's central bank said it had been looking into cryptocurrencies as legal tender, as reported by CNBC on Wednesday.

Technical levels to consider:

On the downside, the next target for the pair comes at $3600 (Aug. 22 low) ahead of $3380 (Aug. 11 low) and $3000 (psychological level). On the flip side, $4000 (psychological level) now aligns as the first technical resistance followed by $4160 (daily high) and $4380 (Sep. 12 high).

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