Cryptos Crash After China Again Vows Crackdown On Mining And Trading

Another day, another attempt by China – where the reception of the digital yuan has been a total disaster so far much to Beijing’s complete humiliation – to crash Crypto, with Reuters and Bloomberg reporting moments ago that just two days after the PBOC barred financial institutions from accepting bitcoin as payment, China’s vice premier Liu He said (at 11pm on Friday local time) that China will crack down on bitcoin mining and trading activities, which of course is what we already knew.

From Reuters:

CHINA’S VICE PREMIER LIU HE SAYS TO CRACK DOWN ON BITCOIN MINING AND TRADING ACTIVITIES

And From Bloomberg

*CHINA REITERATES CALL FOR CRACKDOWN ON BITCOIN MINING, TRADING

So China will reiterate, i.e., repeat what it has said, the same news every day until bitcoin hits 0? Or at least it hopes to, and somehow this is supposed to inspire confidence in the digital Yuan? And yes, this is as some have jokingly pointed out, the 1000th time China has tried to ban bitcoin:

BREAKING: China attempts to ban #Bitcoin for like the 1000th time.

— Bitcoin Magazine (@BitcoinMagazine) May 21, 2021

What is even funnier is that a month ago Peter Thiel grabbed headlines with his laughable conclusion that bitcoin was helping China to end the reserve status of the dollar and was a “Chinese financial weapon”. How about now, Peter, is China’s crushing bitcoin to boost the dollar? Inquiring minds want to know.

Incidentally, a cynical take of this report is that it is great news as it means no more dirty coal bitcoin mining in Xinjiang. How will the ESG cult bash bitcoin if there are no more coal-fired plants generating the electricity for Chinese miners?

As a reminder, China is the bitcoin bears biggest friend: as long as bitcoin can be mined in China it is “dirty.” Once China bans bitcoin mining there, the anti-ESG case collapses as miners end up moving to cleaner and more ESG-friendly venues.

In any case, the news was enough to spark another algo-driven liquidation as the robots apparently have a 15 nanosecond memory and have forgotten that China has said all this and more both a few days ago as well as years ago when it first cracked down on crypto and banned bitcoin and its peers on the mainland.

The selloff has pushed bitcoin back under its 200DMA again:

And stocks follow cryptos lower, as China now appears to also be attacking the US stock market – which has become joined at the hip with crypto.

Will this aggression stand, Mr “big guy” president?