The market is now a bit calmer after the news of the complete ban on digital currencies in China and the fall in prices. However, experts expect price fluctuations to continue in the coming days.
to the Report The announcement of a ban on digital currency trading in China was accompanied by increased selling pressure in the market, and now Bitcoin has entered a price stabilization phase with support above $ 40,000. Bitcoin prices have fallen about 13 percent in the past seven days, with Ethereum falling 19 percent over the same period. Analysts expect price fluctuations to continue as pressure from regulators around the world continues.
Tokens from digital currency exchanges, especially those popular among Chinese users, were sold at low prices on Friday. On Friday, the price of the Huobi exchange token fell about 23 percent, and the FTX exchange token fell 12 percent.
James Butterfill, an investment strategist at CoinShares, wrote on LinkedIn on Friday:
About 10% of the total volume of bitcoins in the world belongs to OKEX and Hobby exchanges. China regulates this amount from 30% in 2019 [به ۱۰ درصد در سال جاری] Reduced.
Butterfly says the news of a trade ban in China on Friday should not have a big impact on the price of digital currencies.
Nevertheless, some analysts still emphasize the importance of Chinese legislation. “Simon Peters, an eToro analyst, said:
In a quick move, one-seventh of the world’s population was officially excluded from the digital currency market. Until now, digital currencies were well known in China, which makes their complete elimination an important event.
Pressure from regulators is nothing new for the digital currency market. Analysts and traders continue to pursue government bans. These things usually happen when the market is volatile.
FundStrat Investment Consulting wrote in its report on Friday:
This is not the first time such an announcement has been made [سوی مقامات] Exported in China, similar measures were imposed in 2013 and then following the boom in the digital currency offering (ICO) market in 2017.
Prohibition of digital currencies in China
China’s central bank released a list of banned activities late last week, some of which were previously in a legal vacuum. The country’s National Development and Reform Commission has also drawn up a plan to completely halt mining-related activities.
The announcement barred banks and other financial institutions from providing services related to digital currencies. In addition, regulators plan to launch a mechanism for early warning and to stop the turmoil in transactions and extraction of digital currencies.
According to the country’s regulators, the extraction of digital currencies is considered an “obsolete” industry. New projects will not be licensed, and current projects will be suspended at the same time.
Some experts believe that China’s recent move to ban digital currencies altogether was their strongest.
Also read: 12-year enmity between China and Bitcoin; The country has tried to kill bitcoins nearly 20 times
Departure of miners from China
Digital currency miners have left China in the past month. The chart below shows the migration of these miners to Kazakhstan, the United States, Argentina and other countries.
Fund Start has said:
Kazakhstan was one of the countries that made the most of China’s long-standing enmity with digital currencies. Kazakhstan is among the cheapest countries in the world in terms of electricity tariffs, costing approximately $ 0.03 to $ 0.04 per kilowatt hour (depending on the price of the dollar in this country).
Key Ethereum price support
Ethereum, the market’s second-largest digital currency, broke its $ 3,000 support on Friday. The digital currency fell 8 percent two days ago, while Bitcoin fell about 5 percent in the same period.
Buyers are expected to push the price above the 100-day moving average (MA) at $ 2,735 to resume the uptrend that began in July. If this level is broken, buyers should not allow the price to fall below $ 2,600, as most of the long trading positions will be liquidated.
If Ethereum fails to maintain support levels, prices could fall as low as $ 2,000, although short-term buyers can remain active, given the signs of saturation in the chart.
The chart below shows that last week Ethereum trading volume in the CoinBase exchange surpassed that of Bitcoin.
In a newsletter to his corporate clients on Friday, Coin Bass referred to the digital currencies Solana, Cardano and Algorand, saying:
Solana is firmly in third place [بازار] Cardano still has a significant share in the overall volume and Algrand has acted similarly to last week.