Digital Assets: China May Crack Down On Bitcoin Mining; Fresh Slide In The Crypto

May 21, 2021 | Digital Assets, News
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The leading cryptocurrency slid sharply today after more anti-bitcoin rhetoric emerged from China.

China’s phobia of social unrest following financial market upheavals has led its regulators to go hammer and tongs at cryptos. Their dire reminders earlier this week of the regulatory position on cryptocurrencies played a not insignificant role in the great bitcoin crash on Thursday. But there were more grim pronouncements regarding bitcoin from China today. (CNBC)

Chinese Vice Premier Liu He and the State Council said in a statement that it was considered necessary to “crackdown on Bitcoin mining and trading behavior, and resolutely prevent the transmission of individual risks to the social field.”

“Severe” actions

“It is necessary to maintain the smooth operation of the stock, debt, and foreign exchange markets, severely crackdown on illegal securities activities, and severely punish illegal financial activities,” the statement said.

Bitcoin, which had regained some semblance of stability after the flash crash, and was trading around $41,450, fell sharply and is currently trading at $36,845.

Meanwhile, Hong Kong’s Financial Services and the Treasury Bureau (FSTB) said on Friday that all virtual asset (VA) exchanges should be licensed if they wished to operate in Hong Kong.

Further, only professional investors with a portfolio upwards of $1m will be able to use the platforms.

On Thursday, the U.S. Treasury announced steps to crack down on cryptocurrency markets and transactions. It said it will require any transfer worth $10,000 or more to be reported to the Internal Revenue Service.

Illegal activity

“Cryptocurrency already poses a significant detection problem by facilitating illegal activity broadly including tax evasion,” the Treasury Department said in a release.

Meanwhile, Bloomberg reported yesterday that insurance major CNA Financial had to pay in March a ransom of $40 million to cybercriminals that stole data and locked its systems. This kind of payment is usually made in untraceable cryptocurrencies.

More recently, hackers shut down the Colonial Pipeline and disrupted fuel supplies on the East Coast. They had to be paid nearly $5 million in ransom.

Related Story:  Insurance Major CNA Coughed Up $40M Cyber Ransom In March

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