Bitcoin tanks after Chinese condemnation
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(Kitco News) - Bitcoin has plunged during the European session this morning after the China State Planner said they are to strictly prohibit financial support for new cryptocurrency mining projects. The People Bank of China (PBoC) also went on the offensive as it noted that "cryptocurrency-related activities are illegal"
In addition to this, the PBoC said that overseas exchanges must not provide services to mainland investors. This is a killer blow for the crypto industry if it is properly enforced as China is a massive part of the consumption and creation of cryptocurrencies.
Lastly, the PBoC said financial institutions are not allowed to offer a service for crypto. As more crypto futures and options are being offered to institutions this could hinder CME BTC futures and Baktt options etc.
Looking at the 4-hour chart below, you can see where the red arrow is pointed there was a large reaction to the news. The price has now been making lower highs and lower lows since the high of $52,944 had been hit on 7th September. Now the next support level looks like it could be either the grey upward sloping trendline or the green zone near the psychological $40k zone.
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