Bitcoin tumbles 8% after China steps up crackdown on crypto mining, shutting down 26 key sites in Sichuan

China bitcoin mining crackdown Chinese flag cryptocurrencies
China is increasingly cracking down on bitcoin.

Bitcoin dropped 8% on Monday after Chinese authorities ramped up their crackdown on cryptocurrency “mining” over the weekend, with bodies in the Sichuan province ordering 26 of the biggest miners to halt operations.

The world’s biggest cryptocurrency fell to $32,950 as of 6.20 a.m. ET. Bitcoin was down around 49% from April’s record high of close to $65,000, but was still roughly 12% higher for the year.

Other cryptocurrencies also dropped sharply, with ether down around 6% and binance coin roughly 4% lower, according to Coinmarketcap. A broader market sell-off also appeared to be weighing on crypto, as investors moved towards safer assets.

The latest move by Chinese authorities to restrict bitcoin mining came in the southwestern Sichuan province over the weekend, when bitcoin miners were told to “clean up and terminate” their operations. Sichuan authorities said 26 bitcoin mining companies must be closed down on Sunday, according to a notice seen by the South China Morning Post.

Chinese state media outlet Global Times then reported that more than 90% of China’s bitcoin mining capacity was estimated to be closed down, at least for the short term, on Sunday.

Bitcoin mining – whereby computers solve complex puzzles to secure the network and mint new coins – has become a target in increasingly climate-conscious China because of the huge amounts of energy it uses.

Sichuan’s clampdown followed similar moves by authorities in Xinjiang, Yunnan and Qinghai.

“The dominant driver of bitcoin right now is the crackdown on mining & trading in China that began in May,” Michael Saylor, a leading bitcoin bull and chief executive of tech firm MicroStrategy, wrote on Twitter.

“This created a forced & rushed exodus of Chinese capital & mining from the bitcoin network,” Saylor said, describing this as “a tragedy for China and a benefit for the Rest of the World over the long term.”

Jeffrey Halley, senior market analyst at currency group Oanda, said the broader drop in risky assets following the Federal Reserve meeting was also weighing on bitcoin. Stocks have sold off after Fed officials on Wednesday moved forward their estimates of when the US central bank would have to raise interest rates.

“If, as I expect, the global buy-everything unwind continues this week, bitcoin will feel those chill winds as well,” Halley said.

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Mike Novogratz says bitcoin will be stuck around $45,000 for a while after Elon Musk’s tweets – but says ether is having a moment

Mike Novogratz
Mike Novogratz is a leading figure in the bitcoin investment community.

  • Mike Novogratz said bitcoin will be stuck somewhere between $40,000 and $50,000 for up to six weeks.
  • Bitcoin has tumbled around 30% from record highs after Elon Musk criticized the token’s energy use.
  • Novogratz told Bloomberg that Ethereum’s ether is “having a moment” and has many use cases.
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Billionaire crypto investor Mike Novogratz has predicted bitcoin will be stuck somewhere between $40,000 and $50,000 for four to six weeks after Elon Musk halted Tesla payments in the token and criticized its energy use.

In interviews with Bloomberg, Novogratz also said ether – the Ethereum network’s cryptocurrency – was “having a moment” because decentralized finance applications, stablecoins and non-fungible tokens, or NFTs, were being built on the system.

Novogratz called a $40,000 to $50,000 bitcoin price range fair and said: “I think we are going to consolidate for a while, four to six weeks.” He added bitcoin may be stuck between $40,000 and $55,000 for the “next chapter” before ending the year much higher.

The former hedge fund executive said his crypto investment firm Galaxy Digital was buying bitcoin because it thinks it shouldn’t dip below $42,000, the level that was tested on Monday.

Bitcoin was up around 1% to $45,097 on Tuesday. But it’s still down 30% from the record high of near $65,000 hit in April, after a hint from Musk that Tesla may sell its bitcoin holdings caused a further sharp fall on Monday. Musk later clarified Tesla had not sold any bitcoin, which it bought for $1.5 billion in January.

Although Musk’s actions have angered many figures in the bitcoin community, Novogratz said the Tesla boss’s concerns should be taken at face value.

“We use electricity for things that we think provide a tremendous amount of value. And so I think you’re going to see a response from this industry, like you should see a response from every industry, to say… we should do something to offset our footprints,” he said.

Novogratz said the traditional financial world was become increasingly excited about ether, the token on the Ethereum network.

“ETH is certainly having a moment, and it’s having a moment for good reason,” he told Bloomberg TV.

“Right now, it’s got the triple whammy. It’s got payment coins, i.e. stablecoins, being built on top of it. It’s got DeFi [decentralized finance] being built on top of it, and it has NFTs [non-fungible tokens] being built on top of it. So the three major thrusts of the crypto revolution are being built on top of Ethereum.”

Yet Novogratz would not say whether he thought ether could climb higher, after having risen by around 370% year-to-date to $3,500 on Tuesday. He said it would be “healthy” if ether consolidated where it was.

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Ethan Allen stock is soaring as traders confuse its ticker with the identical one for ether

FILE PHOTO: A trader works on the floor of the New York Stock Exchange (NYSE) in New York, U.S., March 20, 2020. REUTERS/Lucas Jackson
  • One beneficiary of the 2021 crypto boom is furniture chain Ethan Allen, which shares an identical ticker symbol with ether.
  • The furniture retailer has seen its stock climb 51% year-to-date while ether has more than quadrupled.
  • Most of the online message forums for Ethan Allen are riddled with messages about ether.
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Shares of Ethan Allen have surged more than 50% year-to-date and are up nearly 200% over the past year, potentially due in part to trader confusion over the ticker symbol it shares with cryptocurrency ether: ETH.

Ether, which works on the ethereum blockchain, has been on a tear so far this year, quadrupling to more than $3,000 as a boom in bitcoin helped set the stage for an investor frenzy in other alt-coins like ether and dogecoin.

The StockTwits investment forum dedicated to Ethan Allen is riddled with messages about the cryptocurrency rather than the furniture seller. Daily message volume on StockTwits’ Ethan Allen page has surged 300% since the start of May, which coincides with a parabolic surge in ether’s price.

“We’ve definitely seen a massive increase on a percentage basis in mistaken activity on the Ethan Allen stream,” StockTwits CEO Rishi Khanna told The Wall Street Journal.

That’s not to say Ethan Allen is up solely due to potential ticker confusion with ether. The furniture retailer has seen a boom in business amid the pandemic as demand for homes surged to records. Year-over-year revenue growth of 18% in the first quarter of 2021, combined with a special dividend announcement of $0.75, helped propel shares higher in late April.

This isn’t the first time investors have mistaken a ticker symbol or company name with another company that was in the news, leading to a massive price increase as retail investors created buying pressure. In January, shares of Signal Advance soared more than 11,000% after Tesla CEO Elon Musk recommended a similarly named privacy app that was not publicly traded.

And in February, tweets about audio-app Clubhouse from Musk spurred a massive surge in Clubhouse Media Group, a microcap stock unrelated to the popular audio-chat application.

If anything, the trader confusion over ticker symbols and company names should serve as a warning to new investors that are eager to put money to work: slow down and perform the proper due diligence before investing in individual stocks.

Read more: ‘Wolf of All Streets’ crypto trader Scott Melker breaks down his strategy for making money using ‘HODLing’ and 100-times trade opportunities – and shares 5 under-the-radar tokens he thinks could explode

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Ether should be as much as 75% lower at around $1,000 based on network activity, JPMorgan says


Measures of network activity suggest that ether – the cryptocurrency on the Ethereum network – should be trading as much as 75% lower than its Monday price at around $1,000, JPMorgan analysts have said.

The bank published a note on Friday that said the recent boom in ether had taken the price above fair value, according to some measures. Ether has soared more than 450% over the past year to a record high above $4,100 on Monday.

JPMorgan’s analysts, led by Nikolaos Panigirtzoglou, said measures of computing power and activity on networks can help assess the fair value of cryptocurrencies.

“Essentially, a larger network of users and miners makes the underlying blockchain more secure, and implies greater acceptability of the cryptocurrency on that blockchain,” they said.

But the analysts said a simple assessment of mining activity and the number of unique active addresses on the Ethereum network suggested ether should be trading at around $1,000 – more than 75% below Monday’s price.

“Prices appear to have diverged somewhat from the measures of network activity since the start of the year,” the analysts wrote.

However, they noted that there were a number of factors that had driven up ether since the start of the year – particularly growing institutional interest and upcoming network changes.

The analysts said the European Investment Bank’s decision to use the Ethereum blockchain network to issue €100 million ($122 million) of bonds “is surely very significant, as it represents the endorsement of the ethereum blockchain by a major official institution.”

Read more: Fundstrat’s head of digital assets research walks us through his $100,000 and $10,500 year-end price targets for bitcoin and ether – and shares the 8 tokens he’s bullish on

They said upcoming changes to the network that will see some ether coins burned are causing excitement, as they imply reduced supply of the asset.

But the report suggested ether investors may have gotten ahead of themselves by piling into the asset so quickly.

JPMorgan’s note also said that the past few weeks have seen large increases in the market size of tokens including Binance Coin, dogecoin, litecoin, and Ethereum Classic.

“The share of bitcoin in total crypto market has fallen steeply over the past month from around 55% to below 35%, and outside of ethereum is likely driven more by retail demand,” the note said.

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Major banks are increasingly keen on the Ethereum network – and it’s helping ether hit record highs


Major banks from JPMorgan to UBS are increasingly keen on the Ethereum blockchain network, and it’s helping the system’s cryptocurrency, ether, soar to record highs.

Ether rose to an all-time high of $2,710 during Asian trading hours, before paring some gains to stand at around $2,672 on Wednesday.

The world’s second-most popular cryptocurrency had risen 15% over the week to Wednesday, according to data provider CoinGecko. It had gained around 260% in 2021 so far, compared to a 87% rise in bitcoin.

The interest from major banks and institutions around the world in the Ethereum network has boosted ether, which is the native cryptocurrency of the network and is used for transactions on it, analysts say.

On Tuesday, Bloomberg reported the European Investment Bank is planning to sell digital bonds using the network’s technology, offering $121 million of debt. The sale will be led by Goldman Sachs, Banco Santander, and Societe Generale, Bloomberg said.

It follows a rise in interest in the blockchain network, on which a range of applications can be built, including non-fungible tokens or NFTs and new technologies in the world of so-called decentralized finance.

JPMorgan, UBS and Mastercard were among the investors in Ethereum development company ConsenSys in a $65 million funding round earlier in April.

“Enterprise Ethereum is a key infrastructure on which we, and our partners, are building payment and non-payment applications to power the future of commerce,” Raj Dhamodharan, executive vice president of digital asset products at Mastercard, said.

ConsenSys has also worked with central banks in France, Australia and Thailand on central bank digital currency projects.

Analysts also say planned upgrades to the Ethereum network to make it more efficient, lower fees and start to destroy coins are helping the ether price.

Dallas Mavericks owner Mark Cuban told the Unchained podcast earlier in April that the move to a more efficient system will mean “the holdback of the impact on the environment will change immediately.”

He added: “That is going to give some people a reason to use Ethereum as a store of value over bitcoin, right there.”

Lex Sokolin, head economist at ConsenSys, said: “We think that Ethereum will become a global digital economy, settling the movement of all types of value across the world, including a meaningful portion of traditional financial services.”

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Ether rallies to all-time high above $2,200 ahead of Coinbase listing, Berlin hard fork

The cryptocurrency ether runs on the Ethereum network.

Ether spiked as much as 8% on Tuesday to a new record high ahead of Coinbase’s direct listing and Berlin hard fork, the next upcoming upgrade to the ethereum network, both happening on April 14.

Ether rose to a record high of $2,287, hitting a market capitalization of $250 billion for the first time. The world’s second-largest cryptocurrency has surged 205% year-to-date amid a broader cryptocurrency rally led by bitcoin.

“Ether is surging because it is relatively undervalued compared to bitcoin,” said Ian Balina, founder and CEO of Token Metrics, a data-driven investment research platform for cryptocurrencies. “Factoring in Coinbase’s $100 billion [valuation] that will bring new users to the crypto space, and ethereum being the only other crypto asset with CME futures contracts for institutions, one can see why Ethereum is surging.”

Bitcoin on Tuesday jumped to an all-time high above $63,000 on excitement ahead of Coinbase’s Nasdaq listing. Cryptocurrency bulls view this as a milestone for the digital currency ecosystem.

“Coinbase direct listing is good to bring mainstream attention to crypto companies,” Kosala Hemachandra, founder and CEO of ethereum wallet MEW. “However, it’ll be really interesting to see where they will be headed from now on. Can they pave the way so Coinbase stocks are actually tradable on Ethereum? I think that’s the way to prove how powerful blockchain can be.”

The Berlin hard fork, meanwhile, is part of an update to the ethereum network, which includes four major changes, which are broken down in a statement released by the Ethereum Foundation. Among others, the upgrades include introducing new transaction types and lowering gas costs.

Balina did add that the while Berlin upgrade is “interesting,” the London upgrade, expected in July, is what could make ether deflationary and more scarce than bitcoin, especially after introducing ether’s ability to be burned after transactions.

Ether’s latest record comes less than two weeks after the coin hit a high of $2,000.

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Ether is at a fork in the road and the cryptocurrency faces a key resistance level at $2,700, Kraken analysts say

Ethereum’s cryptocurrency ether rose 35% in March, Kraken said.

Ethereum’s cryptocurrency ether is at a fork in the road and faces a big test in climbing above $2,700, according to analysts at crypto exchange Kraken.

Kraken analysts, led by Pete Humiston, said in a review of the market on Wednesday that ether had jumped 35% and outperformed bitcoin’s 30% gain in March.

Yet they said: “When looking at historical price action, ETH is at a bit of a fork in the road.” The world’s second-biggest cryptocurrency stood at around $1,990 on Thursday morning.

Kraken said on Wednesday that chart analysis suggested ether’s next big level of resistance is around $2,700. If it passes this level, it could break into a higher band where the next resistance level is $5,000, the report suggested.

Yet the analysts added that there is a danger ether falls below the key support level of around $1,460, in which case it could drop into a lower trading band where the lower support level is $990.

However, cryptocurrencies’ wild volatility means movements are hard to predict and makes technical analysis difficult.

Kraken’s report also said that the second quarter has historically been a good one for ether, which is yet to see a negative return in the period.

Ether has shot up more than 1,000% over the last year as interest in cryptocurrencies has boomed. It touched an all-time high of around $2,150 earlier in April and has traded around $2,000 over the last week.

Developers on the Ethereum network are set to make major changes to the system in July. The alterations will change how transactions work and start to destroy ether coins, which some analysts have said could lead to the price soaring.

Billionaire investor Mark Cuban told the Unchained podcast on Tuesday that he was bullish on ether and the Ethereum network, thanks to its many applications, including non-fungible tokens and smart contracts.

Yet cryptocurrencies continue to divide the financial world. Economist Nouriel Roubini on Tuesday reiterated his charge that bitcoin and other cryptocurrencies are too volatile and difficult to use to be currencies, on Bloomberg TV.

He questioned that there was any value in bitcoin and called it a “self-fulfilling bubble.”

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Ether jumps to all-time high above $2,000, in step with bitcoin’s latest rally

The cryptocurrency ether runs on the Ethereum network.

  • The price of ether surged to an all-time high Friday in lockstep with bitcoin’s rally to just shy of $60,000.
  • “The main takeaway for me is that the increased capital flows into crypto is now making its way into more than just [bitcoin],” Jeffrey Wang of Amber Group told Insider.
  • Sergey Nazarov, co-founder of Chainlink, also attributed the surge in ether to the rise of decentralized finance, or DeFi.
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The price of ether, the world’s second-largest cryptocurrency by market capitalization, surged to an all-time high Friday in lockstep with the rally in the price of bitcoin.

Ether climbed to a high of $2,077 at around 11 a.m. ET. It first broke the $2,000 threshold around 9:50 am ET Friday. The digital asset for the ethereum network has gained 177% in 2021 alone and 1,370% in the past 12 months.

“It’s very positive to see [ether] rally along with [bitcoin] which has been the de facto flag bearer for crypto assets,” Jeffrey Wang, Head of America’s at Amber Group, told Insider. “The main takeaway for me is that the increased capital flows into crypto is now making its way into more than just [bitcoin].”

Wang also said investor diversification bodes well for the whole cryptocurrency space, which has seen a broader rally in recent weeks, boosted by the economic recovery from the pandemic-led recession and the third round of stimulus checks under the Biden administration.

Bitcoin this week has flirted with the $60,000-level on renewed institutional backing from PayPal, Visa, and CME Group.

“[Bitcoin] is a benchmark for investors’ confidence in store of value, while interest in assets like [ether] that focus on the programmable, smart contract side of the ecosystem show investors optimism for the utility and potential of decentralized finance,” John Wu, President at Ava Labs, the team behind Avalanche, told Insider. “Ethereum breaking past this threshold may result in a paradigm shift that will benefit the two to three smart contract networks gaining real traction with decentralized finance.”

Sergey Nazarov, co-founder of Chainlink lab,a decentralized oracle network, also attributed ether’s rally to the rise of decentralized finance, or DeFi, an umbrella term for various applications that use public blockchains and crypto assets to disrupt the traditional financial sectors.

“Ethereum users are now relying on DeFi applications in order to lend, borrow, earn yield, create derivatives, options, and even trade, all without the reliance of any centralized third party like a bank or a fintech like Robinhood,” Nazarov told Insider, adding that this new sector, worth over $45 billion, is the fastest growing in the cryptocurrency industry.

“I would expect to see more users utilize DeFi on Ethereum as they hunt for yield that ranges in the double digits,” Nazarov said. “I wouldn’t be surprised if the total value locked into DeFi apps on ethereum surges past hundreds of billions of dollars.”

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Ethereum developers say an upgrade that will destroy coins is very popular with users after tensions with miners rise

The cryptocurrency ether runs on the Ethereum network.

  • Ethereum developers have defended the changes to the network that will come in the summer.
  • They said the alterations are very popular with users, as they make fees simpler and limit ether supply.
  • But miners remain disgruntled that their fees will be cut, with debate in the community ongoing.
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Developers on the Ethereum network have defended major changes that are set for the summer that will destroy ether tokens and cut the fees paid to miners, saying they’re popular with users and could boost the cryptocurrency’s price.

The planned alteration to the network, known in crypto jargon as EIP-1559, “is very popular among Ethereum users as it potentially makes Ethereum a deflationary asset,” Ben Edgington, a developer at ConsenSys, a company closely involved in the network, said on Tuesday.

Ethereum developers approved significant changes to the network that runs the ether cryptocurrency earlier in March. They are set to overhaul the current system under which users send tokens to miners to pay for transactions to be completed in a kind of auction process.

The changes have sparked anger among miners, however, as they would reduce the fees they receive. Some have even proposed a form of strike.

Yet developers say users support the changes, partly because the reduction in coins could lead to the price of ether rising sharply. Ether traded at around $1,800 on Wednesday. The token has gained around 145% so far this year.

Dan Finlay, lead developer on popular Ethereum wallet MetaMask, said: “Its purpose is to provide a more predictable transaction pricing system that reduces overpayment, and has some deflationary economics as a side benefit.”

Under the changes, which will likely come into force in July, users will send a base transaction fee to the network that would then destroy or “burn” ether tokens, thereby reducing the number of coins in circulation.

It will move the system away from the current mechanism, in which users have to bid to have their transactions included in blocks by miners, which can make fees very costly at times.

Edgington said these issues are “a significant problem for the usability of Ethereum and a barrier to the broader adoption of Ethereum by non-specialists.”

Lex Sokolin, co-head of fintech at ConsenSys, said the changes will take the network fees “from having an unpredictable and unbounded pricing mechanism to something that is much more predictable.”

The anonymous founder of Pylon, a major North American ether miner, said there was a lot of “turmoil” in the Ethereum world. They said miners had spent time and money building facilities, and now could be faced with heavy losses due to the changes.

“It goes back to the point [that] developers don’t mine, so they could care less about a miner, and miners don’t develop, so they could care less about reducing the congestion,” they said.

Some ether miners threatened to effectively go on strike, or try to disrupt the system in other ways in protest at the changes.

But there are signs of peace breaking out, with miners proposing their own EIP – which stands for Ethereum improvement proposal – that would raise their rewards and gradually lower them.

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Bitcoin plunges 18% as investors grow wary of record-breaking rally


Bitcoin plunged as much as 18%, to $45,000, on Tuesday before slightly paring some losses as sky-high cryptocurrency valuations unnerved investors.

The cryptocurrency traded 13% lower, at $47,608.24, as of 11:45 p.m. in New York.

Bitcoin has soared in 2021, with the price more than doubling this year to reach a record $58,350.41. Increased interest from big companies such as Tesla, as well as record amounts of stimulus, have powered the rally.

Yet investors appeared to second-guess the record-breaking run on Monday, with bitcoin plunging from close to $58,000 to below $47,000 before recovering somewhat.

The fall coincided with a sharp drop in technology stocks that saw the US’s Nasdaq index slide 2.46%, suggesting investors were becoming wary of the more expensive parts of the market. Both bitcoin and tech stocks slid again on Tuesday.

Expectations of stronger growth and inflation have boosted bond yields and made the more risky areas of the market look less attractive.

Elon Musk’s comments over the weekend that bitcoin and rival token ether “seem high” appeared to trigger the latest move lower. The Tesla boss has played a large part in the cryptocurrency rally, and his words carry weight among many bitcoin enthusiasts.

Craig Erlam, senior market analyst at currency firm Oanda, said: “The fall that has taken place since shows just how wild an instrument it is, how overbought it had become and how influential the Tesla CEO now is in the space.”

Treasury Secretary Janet Yellen also added to the wariness around cryptocurrencies, telling CNBC on Monday that bitcoin is “an extremely inefficient way of conducting transactions, and the amount of energy that’s consumed in processing those transactions is staggering.”

“I don’t think that bitcoin… is widely used as a transaction mechanism,” she said. “To the extent it is used, I fear it’s often for illicit finance.”

The ether (ETH) price also tumbled on Tuesday, with the Ethereum network’s currency down around 8.9% to $1,557. XRP was down around 15% while Binance’s coin was roughly 13% lower.

Pankaj Balani, chief executive of crypto derivatives exchange Delta, said the downward correction in bitcoin and other currencies had been coming.

“Some leverage has been cleared but the volatility should persist for a few sessions followed by a consolidation in BTC and ETH prices before the next move up.”

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