The negative news from China regarding the cryptocurrency market just keeps piling up. China’s central bank, The People’s Bank of China (PBoC), is forcing banks and financial institutions to stop offering crypto services such as bitcoin (BTC).
It’s actually a repeat of a 2017 ban, but it does show that the Chinese government intends to crack down on this industry even harder. The PBoC recently met with some major Chinese banks and financial institutions such as the Agricultural Bank of China, China Construction Bank, Postal Savings Bank of China, Industrial Bank and AliPay.
The central bank released a statement earlier today (June 21) reiterating the 2017 ban. In the statement, the PBoC names the usual criticisms of crypto allegedly causing financial instability, money laundering and other illegal activities.
In addition, the central bank also wants to take action against so-called over-the-counter (OTC) trade. This course of action has been very popular in China since the 2017 ban. If bank customers are caught carrying out crypto transactions, their bank accounts will be closed and their details passed on to the relevant authorities.
China has been cracking down on the crypto industry lately and a large number of bitcoin miners have been forced to cease operations. As a result, the bitcoin network’s hash rate hit its lowest point in nearly 8 months last weekend. Meanwhile, a large number of mining companies are starting to move to the United States:
The crypto prices already took a heavy blow this morning and the above news throws another shovel on top of that. The price of bitcoin just fell to $32,000 and that of ethereum (ETH) even briefly touched $1,900, but now seems to be making a bounce up.
The reason for the crackdown appears to be mainly related to China’s upcoming central bank digital currency (CBDC). Ironically, it’s also positively impacting video card prices in the country, which are falling for the first time in months.