According to Lomberbit, the Central Bank of China declared all operations with cryptocurrencies illegal on September 24. The ban also applies to foreign exchanges providing services to Chinese citizens. How did the crypto market react to these actions and what should investors expect now?
The Chinese financial regulator announced that digital assets are not a fiat currency, therefore their circulation on the market is prohibited, and all services related to them are recognized as illegal financial activities.
Taking into account the position of the Chinese central bank, the largest crypto exchanges Huobi, Binance and KuCoin banned registration for users from China. And Alibaba Corporation refused to work with cryptocurrencies, stating that it would not accept bitcoin and other digital assets for payment. In addition, Bitmain, which develops mining equipment, may stop selling its equipment in China.
A slight shock on the crypto market
The statement of the Chinese central bank caused a short-term panic in the market. After the appearance of this information, bitcoin quotes fell by almost 5%, and the depreciation of the second most popular digital currency Ethereum approached 8%. Nevertheless, having won back this negative, within a week the quotes returned to growth. By the beginning of October, bitcoin had risen again to $ 47,000, and Ethereum rose above the psychological mark of $ 3,000.