Bitcoin price falls 10% on China crackdown

21 Jun 2021

Bitcoin fell nearly 10% on Monday as the recent volatility within the crypto market showed little indication of slowing down, as China ramps up its crackdown on the Bitcoin mining industry.

The world’s largest cryptocurrency by market capitalisation dropped to a 12-day low of $32,094, bringing smaller coins down with it, Reuters reports.

It previously declined 8.3%, on track for its largest daily fall in a month.

Over the last six days, Bitcoin has lost more than 20%, and has halved from its April high of $65,000.

Nevertheless, it has gained over 10% so far in 2021.

The drop in price comes amid a growing crypto crackdown in China, as authorities ordered Bitcoin mining projects to close on Friday in Sichuan.

In 2020, Bitcoin production in China made up around 65% of worldwide production, as per data from the University of Cambridge.

Companies mining Bitcoin usually hold large inventories of the currency, with any moves to sell large quantities hammering prices.

According to Ben Sebley of London-based crypto firm BCB Group: "(The) crackdown on Chinese miners might mean that they are offloading coin into a thin market and taking us lower.”

In addition, the world’s second largest cryptocurrency, Ether, fell 12%, under the $2,000 mark for the first time in more than a month.

deVere CEO and founder Nigel Green said of the recent volatility in this market that it “should be considered in the same way as turbulence in any other market”.

He went on to add: “Some of the shrewdest investors have constantly utilised market volatility as major buying opportunities in traditional financial markets - and the cryptocurrency market is no different.

“Whether it is Bitcoin, or any of the current generation of tokens, or not, cryptocurrencies are here to stay.”