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China’s Annual Crypto Ban Resurfaces as Market Reacts

China’s central bank has officially announced that all transactions of cryptocurrencies are to be deemed illegal, in the latest of a spate of similar headlines to come from the region.

Familiar Headlines From China

Yet again, we are met with heavy-handed headlines regarding the Chinese government’s regulatory reactions to crypto. The government previously issued similar statements in 2013 and 2017.

On the 24th of September, a joint statement by eleven Chinese government entities confirmed that China again would be working to punish crypto activities. 

The statement explains China will be actively working to counteract the “hidden risks caused by the blind and disorderly development” of the industry.

Source

The language used indicates a state looking to directly impact the perception of the industry and perhaps even the price. 

As expected, a dip did occur.  BTC fell from just over $45,000 to just above the $40,000 mark, and of course, it took a majority of the crypto market with it. The price has since stabilized at around $42,000, according to CoinMarketCap, as the majority of traders consider where they go from here. 

These headlines from China, and their timing, have, of course, become a common occurrence in crypto.

Previous Efforts

We do not have to look too far behind to spot similar noises coming from the Chinese leadership.

In May, Chinese state institutions warned buyers that they were not entitled to any protection from trading cryptocurrencies, as government officials attempted to put pressure on the industry. 

In June, the Chinese government notified banks and payment platforms that they must cease facilitating transactions immediately and issued official bans on mining outright. 

The headlines have become a little stale for many involved in crypto, but their impact on prices as newcomers fear the worst can often be tangible and sway the market in a certain direction. 

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