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China declares cryptocurrency transactions illegal; bitcoin price falls

China’s central bank (PBOC) said all cryptocurrency-related transactions are illegal, reinforcing the country’s tough stance against digital rivals to government-issued money. Recall that back in May, they had banned financial institutions and payment services from providing cryptocurrency services to consumers. Today, the people’s Bank of China posted a Q&A on its website stating that virtual currencies did not have legal status in the country. It also stated that services offering trading, order matching, token issuance, and derivatives for virtual currencies were prohibited.
The cryptocurrency market responded negatively to the news, as the price of Bitcoin (BTC/USD) and other major cryptocurrencies plunged Friday morning after the news. Bitcoin’s price fell by as much as 10% to $40,700 in roughly four hours, according to data. The price of ethereum (ETH/USD) also fell in the same period, losing 12% to $2,736. Collectively, cryptocurrency markets fell from a market capitalization of $2 trillion to $1.8 trillion, approximately a 10% loss, during that time. As of this writing, the markets are recovering. At 19:45 UTC, Bitcoin was changing hands at $42,508.82, and Ethereum was trading at $2,922.79. The total market capitalization for cryptocurrency markets was $1.89 trillion. With this latest development in the crypto space, many experts believe this is an opportunity to accumulate more Cryptocurrency assets.

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