The price of Bitcoin suffered a setback when China imposed a crackdown on cryptocurrency transactions. But, it seems like its price has recently recovered from the dramatic plunge that occurred a few months ago. The price of Bitcoin increased to $44,000 on Monday despite the statement issued by the People’s Bank of China regarding the ban on cryptocurrency transactions and mining. Even Ether has succeeded in breaking above the level of $3,100 ever since the declaration of the cryptocurrency ban by the Chinese authorities.
In the opinion of Fundstrat strategists, the prices of Bitcoin and Ether have rebounded because both cryptocurrencies enjoy a high demand in the cryptocurrency market. The current ban on cryptocurrency is not the first ban declared by China. There have been seven similar crackdowns on cryptocurrency by the Chinese government. Therefore, it is not entirely surprising that the prices of Bitcoin and Ether have rallied around again.
The recent crackdown move by China had been on the offshore transactions in Bitcoin and other cryptocurrencies. China has made it mandatory for the offshore cryptocurrency trading exchange forum, Huobi, to delete all accounts belonging to the citizens of mainland China. Ever since the ban, the stock price of Huobi has dropped by more than 22% on Monday, even though the token price of Huobi has increased by 13% according to the latest CoinGecko stat reports. Apart from Huobi, even Binance has stopped accepting registrations from mainland China and Alibaba has stopped accepting virtual currency.
The Chinese government has also forbidden the banks and other financial institutions from recruiting nationals for cryptocurrency marketing, crypto technology, and payment. According to the Cambridge Bitcoin Electricity Consumption Index reports, there has been a drop in the global hash rate of crypto mining as several miners have moved out of China.