On 27th September, crypto assets began recovering in prices after a severe dip over the weekend. China’s news on banning crypto was the main reason for the recent dip. But investors are now moving past the news. There is also increasing regulatory pressure, but the crypto enthusiasts’ confidence seems to be increasing.
On Friday 24th, news broke that China’s PBOC had declared all cryptocurrency transactions illegal. The news on crypto banning in China sparked out a series of price plunges in the crypto market.
Bitcoin lost around $2k in price on Friday, dropping to around $42k. The second-largest asset Ethereum, also lost about 7% of its market price, ending the day below $2800. The issues continued in the weekend, with bitcoin and Ethereum prices dropping to $40.8k and $2740, respectively.
However, today, the markets seem to change course, and most coins are in recovery. Right now, Bitcoin is trading at $43519, a 0.4% increase from 24 hours ago. Ethereum is currently trading at $3078. Moreover, the entire global crypto market is recovering from $1.7 trillion yesterday to $1.95 trillion today.
Bitcoin may regain its $52k level if the trend continues, and Ethereum may hit its one-month-high of $3900. Generally, although the news crashed the market, this recovery shows that crypto users are ready to go past the ban issues.
Crypto Enthusiasts Moving Past Ban and Other Issues
On announcing the ban, China’s PBoC reposted a document earlier posted on 15th September. Some crypto users noted that the exact wording was used in another document banning crypto in 2017. Thus, although China has been ‘banning’ crypto, the asset is still trading in the country.
This month, crypto faced many issues in China that vastly drove the crypto prices down. Foremost, there were rumours that China was increasing efforts to trace crypto mining firms. Later came the case of Evergrande. The Evergrande issue was so big, it crashed the global markets, including crypto. Clearly, due to crypto’s volatile nature, the coins lost their prices.
However, the price actions show that the coins are also recovering very fast. The recovery of the crypto assets is due to the increasing investor confidence in crypto. Furthermore, with the bad news also there have been positive developments in crypto recently. So, even when ban threats increase, crypto enthusiasts are still confident with the coin.
Increasing Regulatory Pressure Globally
The United States SEC has recently been adding regulatory pressure on crypto. The SEC and treasury have specifically targeted large players like Robinhood, Binance, and Coinbase exchange. The FCA of England and also other regulatory bodies have been putting sanctions on crypto. However, these increasing regulatory risks can only cause short-term impacts on crypto.
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