The crackdown by the Chinese authority on Bitcoin mining has resulted in a considerable fall in the value of the largest cryptocurrency by market capitalization. According to the latest reports, Bitcoin suffered a negative growth of 5.5% and fell to $34k on Sunday. The negative impact on the value of Ethereum was also Apparent from its decline of 5.9% to the $2k level.
It is important to consider a considerable drop in the hashrate of Bitcoin as more and more mines are being closed by authorities in China. The lockdown is taking place on the backdrop of excessive use of energy required for mining Bitcoin. This has resulted in short-term sales of the cryptocurrency by investors, thereby causing stress in the digital coin’s value. In addition, the tightening regulatory concerns across the globe is also causing a drop in the value of all major coins, including Bitcoin. Although, to check the future of BTC, you can also read the details provided in Bitcoin forecast, so that you can understand the upcoming years scenario.
The entire fear of cryptocurrencies has been going through a rough patch lately. The market capitalization of all cryptocurrencies, which was around $2.6 trillion last month, has dropped to $1.45 trillion this month. The crackdown by the China authorities has been cited as one of the major reasons behind the decreasing capitalization of the cryptocurrency sphere.
Besides the crackdown, various regulations that are being slapped onto the crypto sphere by policymakers and statutory organizations have also caused uncertainty among investors.
The primary impact of regulators cracking the whip in China is because around 65% of the total mining associated with Bitcoin happens in the country. Therefore, any change in the policy and procedures by the Chinese authorities will have a telling impact on Bitcoin value and its prospects around the globe. It’ll be interesting to see how in the future the Bitcoin and other digital currencies go in terms of their valuations.