eToro: Comment on China's ban on crypto transactions

eToro: Comment on China's ban on crypto transactions

September 24, 2021

Bitcoin China
Bitcoin crypto (05)

Simon Peters, cryptoasset analyst at multi-asset investment platform eToro, comments on today's decision from China to ban crypto transactions.

“The announcement of China's ban on crypto transactions has caused a big sell-off in bitcoin and other altcoins today. The move could prove to be a brake on the global adoption of crypto.”

“At a stroke, effectively, one in seven of the world's population is now officially frozen out of the cryptoasset market. Until now crypto was well-established in the region, making its total exclusion a significant event.”

“From a price point of view, we've seen FUD (fear, uncertainty, doubt) from China before - most recently with the crackdown on bitcoin mining. BTC dropped to just $30,000 back in May as a result, but prices did recover afterwards.”

“This latest price fall could be seen as an opportunity for unfazed long-term holders to 'buy the dip' and further build up portfolios at lower prices. It will be interesting to see if the $40,000 level holds its support, as a break could send prices really tumbling in the short term.”

“For any investors with an interest in crypto concerned about these short-term moves, the most important thing to do is not let fear take hold. Investing should be done with a clear idea of the long-term use cases and potential of the cryptoasset, rather than any short-termist reaction to price movements.”

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