Innocent BenjaminThe already gory week for the cryptocurrency world got even bloodier as the entire crypto market suffered a bone crushing loss of 12.47 percent, following China’s ban on any form of transactions involving cryptocurrency.
Ethereum which had attained an all-time high surpassing $4,000 fell below $3,000 in a 24-hour loss of over 16.22 percent.
This downward trend was maintained and replicated by all of the tokens making up the top 10, with Binance Coin witnessing a massive 17.87 percent wiped away from its value in that time frame.
Bitcoin Falls Below $40,000 for the First Time Since February
It was another nightmare night for the entire cryptocurrency sector, but Bitcoin, the most popular cryptocurrency worldwide, took the lead by falling below $40,000.
The flagship currency however bravely held up to the test by recovering to the safe haven of the $40,000 threshold, but this epitomised the traumatic gamut of emotions that the crypto universe has had to experience in the past few days. This has seen Bitcoin fallen by 38.5 percent since it hit a record high value bordering $64,500
It was in general a disastrous scenario, as the sector has returned well below 2 trillion in capitalization.
Great capital burned, strong bearish pressures and chaos, in particular for those who are little familiar with the cryptocurrency market and its volatility.
The anxiety levels hit panic height not just because BTC continues to lose dominance but that this time, it has managed to bring down other cryptocurrencies, even those that have a weak correlation with it.
World’s Second Largest Economy Fuels the Burning Furnace
Although the cryptocurrency universe was already bleeding, the injury was solely being felt by Bitcoin who were reeling from anti-actions from Tesla and their billionaire boss, Elon Musk. But that was the only crux, until China struck.
China has prohibited the use of cryptocurrencies for all transactions in the country, to restrict institutions and banks of the second largest economy in the world from offering services that involve their use.
Neither entities nor online payment applications or services may offer customers any services with crypto assets, such as registration, negotiation, clearing or settlement.
China has however not criminalized the holding or hodling of cryptocurrencies by individuals.
Despite this, it still prohibits the possibility of managing exchanges in the country and offering tokens via ICOs. The position of the country’s regulators does not differ too much from what they have been expressing in recent times about this type of assets, although the news has generated more volatility in this sector.
The Beijing authority maintain that digital currencies threaten the security of people’s property and are a disruptor in the economic and financial order. They consider that “not being supported by real value,” prices can be manipulated, according to the Reuters agency in the official statement. The decision has been endorsed by the China National Internet Finance Association , the China Banking Association and the country’s Payment and Clearing Association.
In recent days, ‘cryptos’ have also suffered from the comments of Tesla founder Elon Musk and the decision of the electric vehicle manufacturer to stop accepting them as a payment method to acquire their vehicles – reversing in the decision just three months after admitting them. Since then, the cryptocurrency market has seen its capitalization sink by nearly $ 700 billion.
Few weeks earlier, Turkey had banned official cryptocurrency payments with one of the country’s major exchanges shut down in a hurry.
In the same way, there are different countries that are now historically adverse to the world of cryptocurrencies, albeit with situations that are often less clear-cut. These are the cases in Nigeria and India, the latter where there has long been talk of a possible loosening of the squeeze on Bitcoin and other cryptocurrencies, with current rules that are among the most restrictive in the world.
To further ignite more flame, China is the country with the highest level of mining activities.
Binance’s CZ Calls HODLERS to Arms
Despite his exchange earning commissions from trading, Binance’s CEO CZ, in a series of tweets against his interest, called small investors to arms.
I would love to tell you guys to over trade, it would be good for commissions.
But I have to tell you:
For most of you, HODL is a much better strategy in the long run. Don’t over trade.
Nfa.
The position taken by the CEO of Binance is only one of the many that invite, in particular through social networks , to hold positions and avoid panic selling.
I would love to tell you guys to over trade, it would be good for commissions.
But I have to tell you:
For most of you, HODL is a much better strategy in the long run. Don’t over trade.
— CZ ? Binance (@cz_binance) May 19, 2021
James steller
