Bitcoin and Ethereum sink as China steps up crypto crackdown

Bitcoin and Ethereum sink as China steps up crypto crackdown

A visual representation of the bitcoin cryptocurrency on November 20, 2018 in London, England.

Jordan Mansfield | Getty Images

Bitcoin and Ethereum fell into the red on Friday as traders were upset by the difficult talks with China.

According to data from Coin Metrics, the price of bitcoin has fallen almost 6% to $ 42,240. Ethereum, the second largest digital currency, fell more than 9% to $ 2,855.

It is stated in a Q&A from the People’s Bank of China that all crypto related activities are illegal. The PBOC has said that services offering exchanges, order matching or derivatives for virtual currencies are strictly prohibited, while foreign exchanges are also illegal.

Beijing has cracked down on crypto more and more this year. The Chinese government has decided to eliminate digital currency mining, the energy-intensive operation that validates transactions and creates new coins. This resulted in a sharp drop in the processing power of bitcoin as miners took their equipment offline.

The PBOC has banned banks and non-bank payment institutions such as Ant Group, a subsidiary of Alibaba, from providing services related to virtual currency. In July, officials called on a Beijing-based software company to cease its involvement in the crypto trade.

This is a developing story. Check back for updates.

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