Cryptocurrency market last week: sharp decline due to profit-taking pressure and blows from China
The virtual currency market was on fire last week amid regulatory blows from China and profit-taking pressure. Over the weekend, however, the rates of digital currencies rose. Bitcoin temporarily fell to $ 56,000 before bouncing back above 58,000 USD.
China is sending a warning signal
The Chinese authorities continue to step up their campaign to tighten controls on “virtual currency mining”, calling it an “extremely harmful” activity that threatens to sabotage China’s emissions reduction efforts.
During a press conference in Beijing on November 16, spokesman for the Chinese National Development and Reform Commission (NDRC) Meng Wei sharply criticized Bitcoin mining. Ms. Meng said the operation “uses too much electricity” and “produces too much CO2 emissions”.
She said the NDRC – China’s highest economic planning agency – will take “sweeping” crackdown on cryptocurrency mining by focusing on commercial virtual currency mines and the role of state-owned companies in the field. She also said that the production and trading of virtual currencies pose “enormous risks” and criticized the industry as “blind and disorderly”.
Under the new plan, the NDRC will increase electricity prices for any organization found to be using subsidized electricity to participate in virtual currency mining activities. China often subsidizes electricity prices for schools, community facilities, and social welfare organizations.
This isn’t the first time China has made a tough statement against the cryptocurrency mining industry. Since May, the country has stepped up a campaign to tighten controls on virtual currencies, including a total ban on virtual currency trading and increased monitoring of virtual currency mining activities. In such a context, the virtual currency mining industry in China is said to be “slow”.
China once represented more than 75% of the world’s bitcoin mining capacity, according to a report by Nature Communications in April. However, according to some analysts, the US has recently overtaken China as the new hub of global cryptocurrency mining.
Bitcoin is falling 6 days in a row (Cryptocurrency).
On November 19, Bitcoin fell below the 56,000 mark for 6 consecutive days USD for the first time since October 2021.
The world’s largest digital currency hasn’t seen such a long decline since May 2021. Unlike other traditional assets, virtual assets trade on weekends, so the decline includes Saturday and Sunday.
Strategists cite a number of reasons for the Bitcoin sell-off this week, including regulatory blows from China and an overheated Bitcoin bull chain. Many technical analysts are currently looking for technical signals to see how far Bitcoin can go.
Bitcoin has fallen below the 50-day moving average (MA) – an important level for technical analysts. According to Matt Maley, Head of Market Strategy at Miller Tabak + Co, the top level of support for Bitcoin is 54,500. USD.
“The decline, although severe, has not affected the positive mid-term indicators,” said Katie Stockton, founder and managing partner of independent research firm Fairlead Strategies. “So we expect the decline to end by the end of this week.”
Red color covers the virtual currency market
On November 20, Bitcoin rebounded nearly 5% to 58,526 USDbut still down 8% over the past week. Similarly, Ethereum is down almost 7% to 4,280. gone up USDbut still down 7.7% over the past week.
Other cryptocurrencies also saw a 7-10% decline.
In particular, two up-and-coming cryptocurrencies Solana and CARdano have entered the top 5-6 of the world’s largest cryptocurrencies, each with 65 market capitalizations. Billion USD and 62 Billion USD.
The market capitalization of virtual currencies fell by almost 200 billion VND USD in last week, about 2,600 Billion USD on November 20
Top 10 largest digital coins