China’s central bank has banned virtually all transactions in cryptocurrencies, outlawing digital tokens such as Bitcoin.<\/p>\n\n\n\n
It is the latest and most decisive move in China’s domestic crackdown on what it views as a volatile, speculative investment and scapegoat for money launderers.<\/p>\n\n\n\n
China is one of the world’s largest markets for cryptocurrencies. Fluctuations there often affect the value of cryptocurrencies worldwide.<\/p>\n\n\n\n
China has banned cryptocurrencies since 2019, but its cryptocurrency market continues to flourish online through foreign exchanges.<\/p>\n\n\n\n
China’s statement has now made it very clear that individuals involved in “illegal financial activities” commit a crime and face prosecution, as do foreign websites that provide these services to Chinese citizens online.<\/p>\n\n\n\n
The technology behind cryptocurrencies relies on many distributed computers to verify and verify transactions on a giant shared ledger called the blockchain. New “coins” are randomly awarded to those who participate in this work – known as crypto “mining”.<\/p>\n\n\n\n
China, with its relatively low power costs and affordable computer hardware, has long been a center for bitcoin mining.<\/p>\n\n\n\n
In September 2019, China accounted for 75% of global bitcoin energy consumption, though that number has since fallen to 46% as of April 2021.<\/p>\n\n\n\n
The price of Bitcoin fell more than $2,000 in the wake of the development.<\/p>\n\n\n