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Bitcoin Keeps Plunging After China Escalates Crypto Crackdown

The price of Bitcoin and other cryptocurrencies plunged on Monday as China’s central bank gathered officials from the country’s biggest banks and payment processors to recap on a cryptocurrency services ban and to instruct them to adopt a more active role in restraining cryptocurrency trading and activities involving digital assets.

Bitcoin dropped as much as 4.3% and is hovering around $32,000 at the time of writing. Ether, the second-largest cryptocurrency fell as much as 4.2% at one point.

Officials from the Industrial and Commercial Bank of China, the Agricultural Bank of China, and payment service provider Alipay attended the meeting according to a statement from the Central Bank of China. The financial firms received orders to search their systems and identify customers holding accounts at cryptocurrency exchanges or trading cryptocurrencies in the over-the-counter market. In the case of such clients, the institutions should proceed with the prohibition of sending or receiving money in their accounts.

Other factors leading to the drop in bitcoin and its peers include the possibility of greater crypto regulatory supervision in the U.S. and new attempts by China to control bitcoin mining on high-energy consuming computers.

The business intelligence company, MicroStrategy announced on Monday a purchase of 13,005 additional Bitcoins for about $489 million in cash. The news did not strengthen the digital asset as Elon Musk and Tesla’s distancing from Bitcoin is causing concerns over the digital coin’s wider institutional adoption.

Despite Bitcoin’s 50% drop from its mid-April all-time high of $65,000, the digital coin is still registering a 200% growth over the past year. Despite China’s crackdown on digital assets, crypto trading is on the rise in the US where banks such as JP Morgan, Goldman Sachs, and Morgan Stanley have started offering crypto products to wealthy clients wishing to partake in crypto trading.

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