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China’s crackdown on Bitcoin shifts into high gear

Bitcoin plunged 11.20% to $31,668 on Monday, June 21. Another vicious selloff was triggered by news that China’s Central Bank ordered large banks and currency platforms to cease performing cryptocurrency transactions and offering crypto services.

The Agricultural Bank, China Construction Bank, Postal Savings Bank of China, Industrial and Commercial Bank of China, as well as the Alipay payment system have said they are ready to comply with the requirements imposed on them. The organizations have pledged to step up monitoring and stop servicing accounts that facilitate the proliferation of virtual currencies. Official were told to identify the accounts of exchanges and OTC brokers dealing in digital assets and to eradicate the use of such payments.

Bitcoin’s market dominance is on the rise and currently stands at 47.46%, pointing to weakness of altcoins and investors’ reluctance to buy into them. In addition to the negativity from China, buyers are spooked by the “death cross” (when the short-term 50-period moving average crosses the long-term 200-day moving average), which shaped up last weekend.

BTCUSDT is trading at a key support level above $30k and $31k bottoms. The bitcoin bulls have been trying to defend that level but are also afraid to go long as they fear surprises from Chinese regulatory authorities. The latest rebounds are being snuffed out and are fading quickly. Selling pressure is strong and is not underpinned by technical factors. If the leading cryptocurrency takes another nosedive, we can expect to see the price action drop to $27k.

BTC could also be pumped/dumped by Elon Musk, who espouses "green" energy. Better off staying in the red than deciding to change. The founder and CEO of the BTC.TOP pool, Jiang Zhuoer, tweeted his reply to Musk’s 50% clean energy post: “Now all mining facilities have been shut down in Xinjiang, Inner Mongolia and Qinghai provinces, only hydropower farms in Sichuan are left. Currently, the clean energy usage by #bitcoin miners already exceeds 50%.” And while Musk remains silent, Tesla has reason to reconsider its decision to halt bitcoin payments and smooth out negativity in the crypto industry.

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