The cryptocurrency market is crashing, with Bitcoin (BTC) down 20% on the week. That’s an enormous drop in a small space of time, so what’s the deal? Why is crypto falling today? Here’s the need-to-know info on the China crypto crackdown and how it’s affecting traders and investors the world over beginning Monday, June 21, 2021.
Crypto News Today: Why are Bitcoin and others down?
Cryptocurrency is crashing because China is actively opposing the crypto mining industry. China does not recognize Bitcoin, Dogecoin (DOGE), or any other form of crypto as legitimate currency.
Although China’s actions aren’t likely to prompt other countries to follow suit, China itself is an enormous market. When a huge player pulls out of an industry, it usually has a negative knock-on effect. When that player also damns the practice on the way out, that negative impact is likely to be worse. In addition to the crackdown on mining crypto, the government is also encouraging Chinese businesses not to accept cryptocurrencies as payment.
It’s possible to interpret this as a blow to the legitimacy of cryptocurrency, likely prompting some investors to sell. Other traders are holding, seeing the move as a political play on China’s part that has no real reflection on the crypto marketplace. Either way, today’s cryptocurrency events are yet further proof of how volatile the sector continues to be.
One upside to the marketplace volatility is that crypto has already come back from steeper declines. If the market caps don’t continue to freefall for much longer, that is. It’s common for cryptocurrencies to fall and recover frequently, so BTC and DOGE could come back following the China controversy.
For more crypto coverage, learn the differences between Dogecoin and renDOGE.