Today on Friday September 24th, prizes from everyone Cryptocurrencies have slumped amid China’s central bank announcement that all crypto-related transactions are illegal and must be banned in the country.
Prior to China’s announcement, most cryptocurrencies were showing good signs of recovery after Monday’s crash that slashed nearly $ 200 million in the cryptocurrency market.
On Friday morning, most cryptocurrencies stabilized their value after the crash on Monday. Bitcoin was trading at $ 44,985.54 per coin, up 2% over the past 24 hours; Ether, the second largest cryptocurrency and the coin linked to the Ethereum blockchain, rose to $ 3,102, up 1.27%. Other altcoins held the cards by about 1.80%.
However, on Friday afternoon, the People’s Bank of China (PBOC) released a statement in which it said that all private virtual currencies such as Bitcoin, Ethereum and other altcoins do not enjoy the same legal status as legal tender, are legally non-refundable, and therefore should not be considered circulating currencies are traded in the market.
As a result, the People’s Bank of China news has sparked another crypto market crash, with Bitcoin falling 4% to around $ 42,560 in two hours, Ether falling 7.5% to $ 2,881 . Cardano fell 3% to $ 2.16, Ripple’s XRP fell 7% to 92 cents, and Dogecoin fell 7% to 20 cents.
While experts stated that Monday the 20th crypto crash – a frequent classic source of crypto price pressures.
For example, popular crypto analyst Michaël van de Poppe said, “Markets always react so strongly to FUD. Impressive.”
George Zarya, CEO at Digital Asset Prime Brokerage and Exchange BEQUANT, said:
“This time it was made very clear that China will not support the development of the cryptocurrency market as this goes against its policy of tightening control over the flow of capital and big tech.”
Similar comments have also been said, stating that global demand for cryptocurrencies has plummeted since earlier this week following the possible collapse of China’s second largest real estate developer Evergrande, which scared investors and caused global equity markets to decline.
Meanwhile, Ulrik Lykke, executive director of crypto / digital asset hedge fund ARK36, said China has been going through a difficult economic period recently due to the uncertainty surrounding Evergrande’s debt restructuring.
However, experts expect the crypto market to experience some retreat in the coming days.
Lykke said that such a scenario wouldn’t be too surprising as Bitcoin and other cryptocurrencies are increasingly recognized and actively used as a hedge against uncertainty and possible devaluation of the fiat currency. He stated that despite the state ban, Chinese authorities are ready to use Bitcoin as a hedge, which would show how much long-term confidence investors already have in the asset.
“While the markets react with a drop in prices every time China takes action against crypto, the effect is smaller and more short-lived each time.”
Lykke went on to explain that investors should be careful not to make emotional decisions based on this trending news. On-chain fundamentals still suggest that the bull market is likely to continue into the fourth quarter.
Meanwhile, Katie Stockton, the founder and chief executive of Fairlead Strategies, recently said that Bitcoin’s uptrend will remain intact over the long term. “Bitcoin is still in control of the long-term uptrend, with our monthly indicators pointing up, which puts short-term volatility in a bullish context,” Stockton said.
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