Published: Thu, January 18, 2018
Research | By Raquel Erickson

Chinese Government Cracks Down on Cryptocurrency Trading

Chinese Government Cracks Down on Cryptocurrency Trading

Last week, the justice minister's remark that the country will ban bitcoin and other digital currencies triggered big sell-offs and a public outcry.

Bitcoin had a huge boom throughout 2017, creeping up above the $1000 mark in January past year and hitting as high as $20,000 in December.

The price of bitcoin fell as much as 20 percent Wednesday, but later recovered and was almost flat at $11,392 around 5:10 p.m. Its current price is still roughly double where it was in November, and down sharply from its recent peak of $1,329 on January 10.

According to CoinDesk, Bitcoin opened trading at $11,348 in value today but has dropped down to $9,702.

Around 1410 GMT, bitcoin stood at Dollars 9,807.56 to record its lowest value since December 1 and a plunge of nearly 50 percent since reaching a record high on December 18, according to data compiled by Bloomberg. It's now down to $1,500, a 65 percent decline.

"Rising unemployment, especially among young people, is also being linked with a growing number of people looking at new ways to try and make money", the BBC said.

China's state-run Securities Times reported yesterday that the country is planning to widen the scope of its crackdown on domestic crypto-trades, by targeting methods including over-the-counter trading, offshore sites used for centralised trading, and peer-to-peer trading of large transactions. Shutting down digital currency exchanges is "a live option but government ministries need to very seriously review it", he added.

Reports of regulatory crackdowns are nothing new. While the markets go through a tumultuous time, let us take a look at how Bitcoin Cash has performed over the past few days and where it is likely to head.

There has been reporting of more expected fluctuations in the price and market value of Bitcoin and other digital currencies since more and more venture capitalists are joining the crypto market.

While this moment could potentially be a short term pull back, investors can still definitely expect to see volatility swings going forward.

Earlier this week France's finance minister, Bruno Le Maire, announced he wants new regulations targeted at virtual currencies to prevent tax evasion, financing terrorism and other crime.

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