Bitcoin falls below $37,000 on news of China’s mining ban

Chinese authorities intend to take action against cryptocurrency mining and Bitcoin trading. Liu He, Vice Premier of the State Council, said during remarks to the Financial Stability and Development Committee.

According to him, to safeguard the financial system, tighter supervision is necessary. He urged regulators to support the real economy, and to decisively prevent and contain financial risks.

The official said it was necessary to ‘fight Bitcoin mining and trading, and to prevent the transfer of individual risks into the social sphere’.

Bitcoin fell 8%. The price of digital gold briefly slid below $37,000 (on Binance).

At the time of writing, the cryptocurrency was trading around $38,000.

Заявление Хэ прозвучало через несколько дней после того, как три ассоциации при Народном банке Китая banned local companies from supporting a digital asset-related business, and citizens were urged to refrain from investing in this class of financial instruments.

Colin Wu noted that Chinese senior officials for the first time directly proposed banning cryptocurrency mining. He believes this may be linked to the sector’s high energy consumption.

This is the first time that the highest level of the Chinese government has clearly proposed a blow to the mining industry.

— Wu Blockchain (@WuBlockchain) May 21, 2021

News out of China: https://t.co/8fOJ0YpAlc

Vice Premier Liu He calls for a crackdown on bitcoin mining and trading activities.

Anti-bitcoin (mining) news regularly comes up, but this is worth monitoring. Miners in China I’ve spoken with are unsure of the impact right now.

Let China actually ban Bitcoin and Bitcoin mining.

Mining would be more decentralized, black market for Bitcoin would thrive and the «China controls Bitcoin» false narrative would disappear.

— WhalePanda (@WhalePanda) May 21, 2021

Earlier, China CITIC Bank banned individuals and legal entities from using accounts to buy and sell cryptocurrencies.

In April 2021, China proposed treating cryptocurrencies such as Bitcoin as investment instruments.

Hong Kong plans to ban Bitcoin exchanges from operating without a license and offer services to retail investors.