Bitcoin value dropped to $32,288 and lost about 7.5 percent of its value, its lowest value in a dozen days as officials in China continued to hold back mining operations, Media officials reported on Monday (June 21).
“The crackdown on Chinese miners could mean that they throw coins into a thin market and bring us deeper,” said Ben Sibley of the London-based crypto company BCB Group, according to media officials.
In the past six days, Bitcoin fell more than a fifth from its April high of nearly $65,000.
Despite the volatility, Bitcoin has gained more than 10 percent so far in 2021.
The second-largest market cap cryptocurrency ether generally fluctuates with Bitcoin and lost about 12 percent of its value, most of what it lost in nearly a month.
Ether fell below $2,000 for the first time. All cryptocurrency mining operations were suspended by officials in Sichuan on Friday (June 18) after the State Council decreed in May to cease bitcoin mining and trading in the country.
Overall, China is responsible for more than 50 percent of global Bitcoin production.
Crypto miners tend to relocate their operations to southwest Sichuan province during the rainy summer months to harness the area’s hydropower resources, media officials reported, citing data from the University of Cambridge. The area has the second-largest mining operation in the country.
Mining companies typically hold large holdings of cryptocurrencies and the sell-offs caused prices to decline, according to media representatives.
China’s crackdown on Bitcoin mining follows the country’s decision to curtail banks’ ability to offer cryptocurrency services.
With fewer bitcoins mined, the scarcity should have spiked prices, but instead, coordinated efforts to shut down mining operations so far have had the opposite effect.
Indonesia’s central bank banned the use of cryptocurrencies for payments last week as the country tries to further reduce crypto-related activities.
Trading in cryptocurrencies as raw materials is still allowed.