This is what sparked the crypto market crash – prices of Bitcoin, Ethereum, Shiba Inu – NationalWorld

China makes all crypto currency transactions illegal after ordering shut down of Bitcoin mining in Sichuan province, leading to crypto market prices dropping

Cryptocurrency market is down 3.42% on the last 24 hours (9.50am, Friday 17 December).

After a year of gains and record highs, crypto currencies are enduring a turbulent time with unpredictable price changes.

Bitcoin and other leading crypto coins experienced a significant drop in share price after investors began dumping mining equipment as China announced fresh regulations.

It follows recent crashes brought on by Tesla making a u-turn on accepting Bitcoin as payment for its products and China clamping down on initial coin offerings, block exchanges and warned against speculative trading.

A further blow was dealt when China ordered Bitcoin mining in its Sichuan province to shut down completely and furthermore told banks to stop supporting crypto transactions, in a latest wave of restrictions on cryptos.

Now the countrys central bank, Peoples Bank of China, has effectively banned digital coins after announcing all transactions of cryptocurrencies are illegal.

The decision has already had an impact on the global crypto market.

Why is the crypto market down?

Chinas crackdown on cryptos comes days after Musks shock announcement.

Musks decision signifies a sharp u-turn for Tesla who only started accepting Bitcoin as payment for its services in February 2021.

It came after the electric car company bought $1.5b (1.06b) of Bitcoin shares, which in turn sent the market price of both the crypto and Tesla soaring.

The billionaire entrepreneur said: We are concerned about rapidly increasing use of fossil fuel for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.

Musk reaffirmed his belief that cryptocurrency has a promising future but that it cannot come at great cost to the environment, in his Twitter post.

Musk has been a long-time advocate of cryptocurrencies and the Tesla decision was felt across the market, with other digital tokens going down in price.

What is the price of Bitcoin and Ethereum?

The price of Bitcoin was 35,440.35 after the latest drop in prices (14 December), according to Coinbase.

Ethereums value is now 2,914.50.

Cryptocurrencies are seen as an alternative to traditional banking methods, cheaper to move money around due to not being regulated by the government or its banks.

The decision by Tesla, and announced by Musk, was seen by some as a slight on the credibility of cryptos to become a viable method of payment against physical currencies.

Which crypto prices are down?

Bitcoin wasnt the only cryptocurrency to feel the initial effects, with most of the top 10 all experiencing dips in value.

Dogecoin, which was initially set up as a joke in 2012 before seeing its shares skyrocket, has also dropped while Solana has seen its market price rise by more than 8%.

Musks influence cannot be underestimated as, even though the likes of PayPal, Mastercard and Facebook have backed cryptos, the Tesla announcement still rocked the market.

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This is what sparked the crypto market crash - prices of Bitcoin, Ethereum, Shiba Inu - NationalWorld