Bitcoin Crashes 12% as China Reiterates Mining Crackdown

Bitcoin was hit by its second piece of bearish news out of China in under a week.

This time, China's financial committee has added Bitcoin mining as a key sector to monitor in an attempt to "resolutely prevent and control financial risks."

The meeting was overseen by Liu He, the vice-premier of the State Council of the People's Republic of China. Of the four vice-premiers who report to the premier of the State Council, Liu He is the lowest-ranked. He is also the director of the Central Financial and Economic Affairs Commission to the Chinese Communist Party.

The report includes a laundry list of other activities beyond Bitcoin mining, including the reform of small- and medium-sized financial institutions, dull the effects of illegal securities activities, and "effectively respond to imported inflation."

This is the first time that the State Council has explicitly spoken out on Bitcoin mining.

Despite the broad nature of the report, Bitcoin plummeted by 12%. The cryptocurrency's price has since recovered to around $37,800, a loss of nearly 8% in the last 24 hours.

BitcoinBTC · USD

$77,836+1.23%

24H7D1M1YYTD

09:30 AM03:30 PM09:30 PM03:15 AM09:15 AM

$78.1k$77.5k$77.0k$76.5k

24h HighHigh$78,061

24h LowLow$76,298

VolVol$981.1M

Market projectionsOdds by Myriad

Today$76,000 to $78,000$76k–$78k59% chanceThis weekBelow $78,000Below $78k54% chance

Price data by CoinGeckoCoinGeckoMore Bitcoin news and projections →

On Wednesday, a similar piece of news dragged the leading cryptocurrency down to $30,000. At that time, a group of three payments and financial associations reiterated the central bank's initial ban from 2017. The three associations were the National Internet Finance Association of China, the China Banking Association, and the Payment and Clearing Association of China.

Sources suggest that the latest crackdown on Bitcoin mining will be limited to operations that are not using hydroelectric power.

The number of coal-powered mining outfits in China is significant. A flooded coal mine in the Xinjiang region last month triggered a steep drop in Bitcoin's hash rate, the metric used to determine how much processing power the Bitcoin network uses.