Bitcoin tumbles below $34,000 Following Chinese ban on crypto services

Newly Listed Geregu Top NGX Gainers Chat, Amidst Negative Market Performance
Newly Listed Geregu Top NGX Gainers Chat, Amidst Negative Market Performance

Bitcoin, the world’s largest cryptocurrency, fell below $34,000 this week for the first time since February following China’s national ban on cryptocurrency services.

Down more than 10%, Bitcoin began to dip a week ago, falling below $50,000 on 13 May. The price rebounded somewhat, reaching $38,000 at the time of publication.

Last week’s decline was sparked by Elon Musk’s Tesla announcing it would no longer accept the currency due to its negative impact on the environment.

Tesla still holds its $1.5 billion investment in Bitcoin, bought back in February.

Chinese financial firms are banned from offering clients any service or product involving cryptocurrency. Bitcoin isn’t the only cryptocurrency to suffer a decline following China’s nationwide ban. Ethereum and Dogecoin were down more than 16% on Wednesday, whilst XRP fell more than 11%.

Dogecoin has experienced a meteoric rise in 2021. Since the start of this year, its value has surged more than 14,000%.

On 18 May, China banned its financial institutions – including banks – and payment companies from providing services related to cryptocurrency transactions.

Firms must not offer clients any service or product involving cryptocurrencies, such as registration, trading, clearing and settlement. They also can’t provide saving, trust or pledging services of cryptocurrency.

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Individuals are not barred from holding cryptocurrencies in China. Though with no local firms offering crypto-related services, and without access to local cryptocurrency exchanges – which were shut down in 2017 – it’s harder for Chinese citizens to do this.