For the first time in three months, the controversial cryptocurrency Bitcoin has fallen below $39,000 on Wednesday. This is after China had warned investors regarding cryptocurrencies saying that it won’t be allowed in transactions as there are speculative methods involved in it.
China encouraged investors to stop trading in Bitcoin despite the country being at top of the list when it comes to mining. It was obvious from these comments that upcoming days were tricky for Bitcoin but Tesla head made it worse. After the comments by Chinese officials, Bitcoin saw a 10 percent blow which was further increased after Elon Musk made certain observations.
China had banned trading in crypto currencies since 2019 when it had shown evidence of privacy breach. The officials then stated that it will prevent cases of money laundering as cash flow will be restricted within the country. China is huge on investing and as per recent numbers, it has around 90 percent of the global trade in this particular sector.
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One of the top banks of China called the People’s Bank of China released a statement saying that the price fluctuations in the crypt market will seriously impact the safety of the public asset and hence impact the economic and financial order. The notice also wanted people to not speculate on the basis of rumors.
The warning said that if a customer faces losses in this sector then it will be entirely borne by themself and the bank is not responsible for it. It stressed on limiting its services to customers as far as cryptocurrency is concerned. However, Linghao Bao, an analyst at Trivium China, asserted that those looking to invest can still find ways to reach crypto investments.
He said,“There will always be a way to circumvent regulations. The point of this order is to tell financial institutions to up their game to detect these crypto-related transactions.”
Since then, bitcoin has struggled to regain its position. On wednesday, it slipped from $45,600 to $38,570, which is the lowest this Crypto has ever reached since early February. Analyst warned that it might get as low as $30,000 if the situation persists.