28.11.2021

China has tried to ban Bitcoin 19 times. How did it end for the cryptocurrency industry?

The price of Bitcoin reacts rather sharply to the new stream of negative news from China, as we saw last week. This time, the government of the country allegedly wants to completely ban all activity with the crypt, except for its storage.

However, the PRC, which until recently remained the most popular country for miners, is gradually losing its influence on the crypto market.

Today we will look at the most famous threats to the main digital asset.

First prohibitions

For the first time, the Chinese government started talking about the “danger of virtual currencies” back in 2009, when Bitcoin remained a little-known concept in narrow circles of crypto fans. Then the Ministry of Culture and the Ministry of Commerce of China banned the exchange of real goods for virtual currencies, although this restriction did not directly apply to Bitcoin.

BTC price dynamics until 2014

But the first direct warning regarding the main cryptocurrency was in 2013, when the People’s Bank of China banned transactions in BTC for financial institutions and called the coin “a phenomenon without any meaning.” Against the background of this news, the value of Bitcoin fell below $ 1,000 on the then largest crypto-exchange BTCC, which, by the way, was located in China.

Fake news from China

In March 2014, a fake article was published on the Sina Weibo website, in which there was a rumor that the Central Bank of China would allegedly ban all transactions in BTC for a month. The fact of the presence of misinformation in the publication was quickly revealed, but this did not prevent the next collapse in the price of Bitcoin.

BTC price dynamics from 2014 to 2017

In almost the same period, the Chinese crypto exchange FXBTC announced its own closure due to threats from financial regulators. The combination of these two news drove the price of BTC down from $ 709 to $ 346 . However, investors perceived this as a profitable opportunity for accumulating coins, and after a couple of months, the price of Bitcoin rose above $ 600 .

Previous bullrun problems

Another case is not directly related to the government of the PRC, but it still happened in this country. We are talking about the hacking of a large Hong Kong crypto exchange Bitfinex in August 2016. Then the hackers were able to steal approximately 119,756 BTC or $ 5 billion at the current rate of the cryptocurrency. Another negative from China contributed to the collapse of the Bitcoin price by about 10 percent .

Bitfinex Exchange

Perhaps the most striking example of active opposition from the Chinese government mentioned in Cointelegraph is the ban on customer service by local crypto exchanges in September 2017. In addition, Chinese citizens were soon banned from participating in the ICO . At that time, Bitcoin was trading in the region of 4 thousand dollars , but after almost three months the pessimism in the crypto market quickly dissipated. As a result, BTC rose to a new all-time high of $ 20,000 .

A month later, the BTCC exchange announced its closure due to a new government decree. However, this news did not make the proper impression on traders – by that time the share of BTCC in the daily trading volume had significantly decreased.

Cryptozyme and the beginning of the COVID-19 pandemic

In January 2018, rumors began to circulate on the Internet that the rapid collapse of the BTC price after reaching a new all-time high was deliberately provoked by the Chinese government. And although this information was never confirmed, by mid-February the cryptocurrency had depreciated by more than 65 percent. This collapse was the beginning of the “crypto winter” – a long period of low trading activity and a constant drop in coin prices after the bull run. However, even in such conditions, Bitcoin broke above $ 10 thousand several times .

BTC price dynamics from the beginning of 2017 to the present day

In April 2019, the National Development and Reform Commission of China once again announced a mining ban. The People’s Bank of China joined the restrictions, announcing the halt of crypto trading in the country. Fall again – but again Bitcoin held out.

The next “bloody” page in the history of cryptocurrency is the collapse in March 2020 amid a sharp decline in stock indices around the world due to panic around the spread of COVID-19. The blame here lies with the Chinese miners, who were hastily selling their coins to lock in losses. Having fallen to $ 3,500 , Bitcoin reached a new all-time high of $ 64,000 almost a year later .

During the current bull run, the latest events were another mining ban in May of this year, a ban on banks’ cooperation with crypto companies and the last restriction on working with crypto in the country. In total, there have been 19 notable negative news from China in the history of Bitcoin , which eventually led to another wave of BTC growth.

Therefore, there is no need to despair – the crypto market is growing every year, and Bitcoin is becoming a more global phenomenon that is quite capable of resisting the superpowers. And while some experts believe that big troubles with financial regulators are still ahead, we assume that digital assets will survive this struggle. At the very least, their decentralized nature will greatly contribute to this.

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