Bank of China seeks to reinforce control of cryptocurrency trading

It's been a rough day for cryptocurrencies in general as Bitcoin's decline fail to inspire confidence in other virtual currencies as well.

Authorities should also block domestic and foreign websites and close mobile apps that provide centralized virtual currency trading services to Chinese users, and sanction platforms that provide virtual currency payment services, Pan said.

The price of bitcoin was sent plummeting 18% as it and other cryptocurrencies yo-yo in value over fears of a wider trading crackdown spurred by renewed potential of South Korean regulatory action. This massive drop, the first in 2018, was enough to scare the entire cryptocurrency market.

Along with South Korea, China has also moved to escalate its crackdown on cryptocurrency trading, according to Bloomberg. Now, the cryptocurrency market cap has hit $590 billion.

You know that Bitcoin price lowest since December is big news when CNN Money covers it and talks about how to buy Bitcoin, and then loses money doing it (bought $20, then sold for just $15.09).

Still, this meant that the cryptocurrency had lost $0.50, or almost 30% of its value, in the Tuesday session. It is a short-term issue and it will soon be overtaken. Nonetheless, the leading cryptocurrency has still lost nearly 40% of its market value since the dizzy heights seen in December.

Neil Wilson, a London-based senior market analyst for online trader ETX Capital, told the news service: "The (South Korean) finance minister made it clear they're definitely considering banning crypto trading - and it's probably the third-largest market". Due to high local demand, cryptocurrencies trade at a significant premium in these countries-20 per cent-30 per cent more per coin.

Recently, another report surfaced that the People's Bank of China (PBoC), the country's central bank, will regulate the use of electricity for bitcoin mining.

Cryptocurrency prices slid on Tuesday, after South Korea said shutting down exchanges is still an option. Bitcoin's price at around $12,000 is generally attractive to investors, yet we can not help but recall billionaire Mike Novogratz, who sold his Bitcoins in late 2017, commenting on the excessive volatility of the currency.

But the government says relying on cryptocurrencies too heavily is risky because of digital currencies' volatile nature and threats of tax evasion.

  • Zachary Reyes