Bitcoin and other cryptocurrencies collapse after Chinese authorities reiterated that digital tokens cannot be used as a form of payment. The queen cryptocurrency, in the last 24 hours, has slipped below 33 thousand dollars (-25.2% on the day and – 46% on the week). With her, all cryptocurrencies drop a bit: from ether (-39%) to dogecoin (-46%) up to Binance Coin (-42.2%) and Cardano (-46%). In general, the capitalization of all cryptocurrencies has risen from the maximum of 2.533 billion dollars to the current 1,480. That is, about 1,000 billion market caps have been lost.
It is a real daily meltdown that was triggered by news from China. The National Internet Finance Association of China, the China Banking Association and the Payment and Clearing Association of China, the three Beijing authorities responsible for supervising banks and the payment industry, have asked individuals not to use cryptocurrencies for any operation. , including trading and converting fiat currencies into digital currencies. On closer inspection, such moves in the Middle Empire are not new. In 2017, for example, the People’s Bank of China closed local cryptocurrency trading platforms, stifling a speculative market equal to then 90% of global Bitcoin volumes.
The yuan digitale
On closer inspection, China has long been a pro-cryptocurrency country. Then, however, he radically changed his opinion and accused them of being a tool in the service of criminal activities. Beyond the official statements, it is clear that, in the face of the desire to launch the digital yuan, Beijing does not want to allow the birth of a parallel cryptocurrency market. Primarily because this could give rise to the instability of a financial system which, in the past, has had several problems (for example with “shadow banking”). And then because, it should not be forgotten, cryptocurrencies (by their very nature of a system without centralized control) have an anarcho-capitalist nature. A characteristic that in an authoritarian country (and not only in that one) such as China is not accepted.
The position of the ECB
And Christine Lagarde spoke again of Bitcoin yesterday. «Bitcoin and ethereum are not cryptocurrencies but cryptoassets. They are speculative, volatile, unstable and as many of my colleagues have said, those who invest in these assets must be ready to lose everything »said the president of the ECB speaking at the Generation euro Students’ Awards 2021.
«To tell the truth – said Lagarde – in recent weeks the prices of many of these assets have suffered a decline of more than 20% and this is only because one person, specifically Elon Musk, said a few words speaking on the Saturday Night Show. This proves that we are not dealing with currencies but very speculative assets ».