Bitcoin bulls News: he news that Chinese banks are now expected to close the accounts of any person or entity related to cryptocurrencies has crashed the markets.
The new bad news from China supports the current bearish trend of the market. Bitcoin has fallen more than 15% in the last seven days, while Ethereum has dropped below $2,000 for the first time since March.
New week opened in red
Renewed legal challenges against Bitcoin in China have plunged the market into yet another panic. In the past 24 hours, the total cryptocurrency market cap has dropped 5% and more than $1 billion has been liquidated from the market. Bitcoin slumped 4%, while Ethereum dropped below an important psychological level of $2,000.
ETH/USD 90-day chart Source: Coinecko.
The key level around $2,000 was crossed at the beginning of April, before reaching an all-time high of $4,356 in May. Since then, during the crash on May 23, the second cryptocurrency by market capitalization, apart from a few short moments, has had a relatively better recovery compared to Bitcoin.
The catalyst for this decline appears to be linked to renewed anti-crypto guidelines for Chinese banks. The People’s Bank of China is seeking to shut down services to account holders and entities involved in crypto trading, Crypto Briefing reported this morning.
Regulatory threats to Bitcoin have multiplied over the past few weeks as China seeks to boost adoption of the digital yuan by adding 3,000 ATMs in Beijing alone. The notification sent by the Chinese government to all banks in the country is actually nothing new, as it is the same as the rules announced in 2014.
The fragile state of the market after Bitcoin’s worst monthly performance in the last decade could not handle the renewed policy in China.