Bitcoin, Ethereum fall as China declares all cryptocurrency-related transactions illegal

The latest directive by China’s Central Bank comes as concern over the debt crisis involving property developer China Evergrande Group has intensified across global markets.

The value of virtual currencies like Bitcoin and Ethereum slipped by several percent after China’s Central Bank said on Friday that it would crack down on cryptocurrency trading, banning overseas exchanges from providing services to Mainland investors.

“The government will resolutely clamp down on virtual currency speculation and related financial activities and misbehaviour in order to safeguard people’s properties and maintain economic, financial and social order”, the People’s Bank of China (PBOC) said on its website.

The bank said that all cryptocurrency-related businesses are illegal, including overseas cryptocurrency trading exchanges that provide services to domestic residents via the Internet.

The world’s largest cryptocurrency — Bitcoin — sank by around five percent, to $42,810. Similarly, the second-largest crypto, Ethereum, fell by over eight percent to $2,868.

Other virtual currencies, like Dogecoin, Ripple, Polkadot, Binance Coin, are also seeing a dip.

Beijing has been acting tough on virtual currencies for a long time. Earlier this year, Beijing announced a crackdown on crypto mining, the energy-intensive process that verifies transactions and mints new units of virtual currency. At the time, Bitcoin and other currencies also faced a slump in their value.

The action against the virtual currencies market comes days after Chinese real estate giant Evergrande Group has failed to pay interest on its massive debt obligations. Global institutional investors are concerned about the ripple effect of the crisis in China’s property market.

Article source: https://nation.com.pk/25-Sep-2021/bitcoin-ethereum-fall-as-china-declares-all-cryptocurrency-related-transactions-illegal