The recurring crypto suppression in China continues to lower Bitcoin and cryptocurrency prices.
Bitcoin experienced a massive crush in May, losing 50% of its value. Since then, bears have been waging war against the father coin. Similarly, Ethereum, the second-largest cryptocurrency after Bitcoin, fell more than half its value. It has been struggling to hold above $2000 per token.
Crypto analysts have warned. Crypto prices are “in danger” following reports former Chinese Bitcoin and Ethereum miners have been dumping GPUs. This implies at least some of the decommissioned Chinese mining capacity will not return.
Mining Affected Seriously in China
The Chinese miners dumping central processing units don’t surprise China’s serious strike on Bitcoin mining in the country.
Adam James, a senior editor at a Hong Kong-based Bitcoin and crypto exchange OKEx. Wrote in his recent analysis, adding “market sentiment has decreased” over the last few days.
Meanwhile, social media reports claim China has blocked access to major cryptocurrency exchanges. Users reported last week that Huobi and Binance temporarily required a location-masking VPN to access.
A global regulatory crackdown has subjected Binance, the world’s largest Bitcoin and cryptocurrency exchange by volume to scrutiny in recent weeks.
Chinese Crypto Miners Forced to Vacate the Country
Following China’s crackdown on Bitcoin and cryptocurrency last month. The Chinese government forced those that mined cryptocurrency to leave the country.
The expulsion of Bitcoin and cryptocurrency miners from China has caused Bitcoin’s hash rate to drop to a 13-month low in the last two weeks.
China’s crypto mining ban has also affected the Ethereum network. Its network hash rate dropping by 20% since May as miners shut down.
After falling below $30,000 in recent weeks, the Bitcoin price has stabilized at just above the psychological level, but its failure to regain lost ground since its May crash has many crypto market observers concerned.
A Storm in the Crypto-verse
“There is a summer lull in the crypto market that may just be the calm before the storm,” FxPro’s senior financial analyst Alex Kuptsikevich wrote in emailed comments, warning that if Bitcoin falls below $30,000, it will “likely trigger a new wave of liquidation.”
“If a few open positions affect the market, any minor storm could turn into a large-scale sell-off, causing an avalanche of stop orders to be disrupted. The most concerning aspect for cryptocurrency enthusiasts is that such a result will highlight the prolonged nature of the correction, increasing speculation about a new ‘crypto winter’ like in 2018.”
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