Crypto Market Dives Over China’s Move on Digital Assets

Dip comes as China warned it will continue to clean up virtual currency mining in the country.

Image Credits: Dan Kitwood / Staff / Getty.

Bitcoin and other cryptocurrencies tanked on Tuesday, retreating from near-record highs, amid tightening of regulations on digital assets.

Top crypto bitcoin dropped almost 8% toward $60,000 during late morning trade, according to CoinDesk data. It recovered some of those losses and was trading at around $60,643 at 08:00 GMT.

Ether was down more than 8% to $4,301 while Polkadot pummeled 11%. Dogecoin’s price fell over 6% to $0.25 and Shiba Inu tumbled over 2%. Other cryptocurrencies, including Litecoin, XRP, Uniswap, Stellar, Cardano, and Solana also were trading in the red over the last 24 hours.

The global crypto market cap declined about 7% to the $2.66 trillion mark. The dip comes as China warned it will continue to clean up virtual currency mining in the country.

The National Development and Reform Commission (NDRC) said during a press conference on Tuesday that state-owned enterprises (SOEs) should get out of cryptocurrency mining, as it was considering imposing punitive measures in the form of higher power prices on companies that continue to defy a government ban.

Mining “causes large energy consumption and carbon emission. It has no active impact to lead industry development or scientific progress,” NDRC spokesperson Meng Wei said on Tuesday, as quoted by CNBC. “Regulating cryptocurrency mining activities has significant meaning in optimizing our industrial structure, saving energy and cutting emission, achieving carbon emission and neutrality goals.”

The NDRC also held a special meeting on the issue last week and is putting increased pressure on provinces and municipalities to investigate and clean up SOEs involved in mining.

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