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BeInCrypto
Home News (BTC) Bitcoin News

Bitcoin Crash Caused by Chinese Cryptocurrency Crackdown, Claims CNBC Guest

by Anton Lucian
Nov 25, 2019 @ 8:15 UTC
in (BTC) Bitcoin News, News, Regulation News
China Bitcoin BTC
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Brian Kelly, the founder of Brian Kelly Capital, suggested that the anti-cryptocurrency regulatory moves by China caused Bitcoin to take a drop substantially. We are in the midst of a ‘digital arms race,’ he claimed.

Blockchain mania is sweeping many of the world’s leading countries as China begins to commit itself to the technology. However, President Xi’s endorsement of blockchain has not been a net positive for the cryptocurrency markets just yet. In fact, its policy of ‘blockchain, but not cryptocurrencies‘ has arguably caused Bitcoin to drop substantially this week.

China Crypto Mining Ban

Chinese Bitcoin Crackdown to Blame?

Brian Kelly, in a recent interview with CNBC, claimed that the Chinese state has taken the curious position of still banning cryptocurrency trading, which has negatively affected Bitcoin’s price. “This caused speculators to start selling… and here we are, down 16% for the week,” Kelly said during CNBC’s Power Lunch. As a result, some of the high-cost miners are at the break-even point or have begun to capitulate. This has caused even further downward pressure on Bitcoin’s price, he claims.

Institutional interest in cryptocurrencies remains high, but there are still significant obstacles. These investors are coming in, but are doing so slowly claims Kelly. What’s promising is that this year, the CFTC officially confirmed that both Bitcoin and Ethereum should be considered commodities. However, the rest of the cryptocurrency market remains in a legal limbo which scares off institutional investors.

In short, Kelly believes Bitcoin’s decline in the past week was caused by three major areas: China’s crackdown on Bitcoin, miner capitulation, and persisting regulatory issues in China and abroad.

BISS

What Comes Next?

China does not seem like it will loosen up its cryptocurrency restrictions any time soon, but it may quickly come to find its ‘blockchain but not cryptocurrencies’ party line to be nonsensical. This is because cryptocurrencies will form a crucial component of implementing blockchain technology throughout the world. Regardless of China’s ban, digital currencies can’t be banned everywhere — which means that China’s hostility to cryptocurrencies will have to falter eventually. We’re already starting to see the cracks.

Kelly’s description of a ‘digital arms race’ is similar to what BeInCrypto reported on recently: we are entering a new period of competing, state-backed stablecoins. With nations recognizing these financial instruments as extensions of their influence, cryptocurrencies will soon be embroiled in the most pressing geopolitical issues of the day.

How does this all look for Bitcoin and the cryptocurrency market in the long-term? Despite the uncertainty, what’s clear is that this industry is set to grow substantially. What consequences this growth will have on the global body politic, however, remains to be seen.


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Tags: China
Anton Lucian

Anton Lucian

Raised in the U.S, Lucian graduated with a BA in economic history. An accomplished freelance journalist, he specializes in writing about the cryptocurrency space and the digital '4th industrial revolution' we find ourselves in. Email.

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As a leading organization in blockchain and fintech news, BeInCrypto always makes every effort to adhere to a strict set of editorial policies and practice the highest level of journalistic standards. That being said, we always encourage and urge readers to conduct their own research in relation to any claims made in this article. This article is intended as news or presented for informational purposes only. The topic of the article and information provided could potentially impact the value of a digital asset or cryptocurrency but is never intended to do so. Likewise, the content of the article and information provided within is not intended to, and does not, present sufficient information for the purposes of making a financial decision or investment. This article is explicitly not intended to be financial advice, is not financial advice, and should not be construed as financial advice. The content and information provided in this article were not prepared by a certified financial professional. All readers should always conduct their own due diligence with a certified financial professional before making any investment decisions. The author of this article may, at the time of its writing, hold any amount of Bitcoin, cryptocurrency, other digital currency, or financial instruments — including but not limited to any that appear in the contents of this article.

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