$BTC 🚫China now bans the holding of cryptocurrencies
Chinese authorities recently tightened restrictions on cryptocurrencies, banning not only mining and trading, which are already illegal, but also the private ownership of cryptoassets like Bitcoin.
🎯 Objective: Control the financial system
This decision aims to strengthen state control over the financial system, particularly in the context of promoting the digital yuan (digital currency issued by the Chinese central bank).
Cryptocurrencies like Bitcoin are seen as direct competitors to this digital yuan.
💥 Market reaction
The market reacted negatively:
Bitcoin briefly fell to $104,684 before stabilizing.
Several altcoins fell, notably Cardano (-5.55%) in 24 hours.Positions were liquidated, such as that of trader James Wynn (949 BTC, or $99 million lost).
🇨🇳 China: still a big holder of BTC
Before the ban, China had begun selling confiscated cryptocurrencies, but it still remains the second-largest holder of Bitcoin in the world (194,000 BTC, approximately $20.6 billion). It is not yet known whether the state will continue to sell all of its reserves.
🌍 Potential impact
This ban could encourage increased decentralization in Asia as users seek countries that are more open to crypto.
Many in the community believe that these bans will not be enough to eradicate Bitcoin use in China.