People’s Bank of China (PBoC) has instructed all financial institutions in the country to help effect the clampdown on cryptocurrency engagements. According to a Reuters report, the apex bank said it recently summoned all financial institutions to intensify the way they prevent cryptocurrency trading.
Per the report, the PBoC urged these institutions to cut payment channels for crypto trading and that they must not offer any form of financial services to digital currency outfits. The overbearing instructions are not the first of its kind as the central bank has always sought new ways to taper down crypto activities in the past decade. However, this current ban is coming amid a growing clampdown on Bitcoin and Proof-of-Work (PoW) related mining activities from one province to the other, with Sichuan being the latest.
Chinese Banks Already Complying
The banks in China are already complying with the directives from the PBoC with the country’s third-largest bank, the Agriculture Bank of China already taking the lead. According to an earlier Coingape report, the Agriculture Bank released a statement earlier today and asked all its customers to refrain from such prohibited activities.
While drawing on the Central Banks instruction, the bank will conduct an investigation into the past activities of its customers to note who has been involved in cryptocurrencies. The current stance of the banks is different from the imposed ban in 2014, and per the outlook, this clampdown is set to stay as other banks are billed to release similar notices to their customers in due time.
Bitcoin is Reacting to the Ban FUD
The price of Bitcoin has plunged, currently changing hands at $32,282, a drop of 5.82% in the past 24 hours at the time of writing. At the current pace, the cryptocurrency is trading at 50.23% from its all-time high price of $64,863.10, set back in April. While it is yet unclear whether this is the worse case reaction of the premier digital currency to the Chinese ban FUD, the dip has fueled about 75% long positions liquidation today.
The road to the ATH and new price territories looks is far, however, analysts including Stock-to-Flow model creator, PlanB projecting a worse case price of $135k for BTC by year’s end.
Bitcoin is below $34K, triggered by Elon Musk's energy FUD and China's mining crack down.
There is also a more fundamental reason that we see weakness in June, and possibly July. My worst case scenario for 2021 (price/on-chain based): Aug>47K, Sep>43K, Oct>63K, Nov>98K, Dec>135K pic.twitter.com/hDONOVgxH1
— PlanB (@100trillionUSD) June 20, 2021