Bitcoin drops below $30,000 for the first time in five months

The sharp decline in the price of Bitcoin has been largely attributed to the Chinese government curbing the mining of these digital currencies.
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The price of the world’s largest cryptocurrency – Bitcoin dropped below $30,000 for the first time in nearly five months due to the stringent action taken by the Chinese authorities to close the mining companies generating these digital currencies.

The price of Bitcoin was $29,719, which is close to an 8 percent drop over the last 24 hour period, as per data provided by Coindesk. This is the lowest that Bitcoin has touched since January 27 this year.

The sharp decline in the price of Bitcoin had an impact on other cryptocurrencies. Ether, the second-biggest currency after Bitcoin, was trading at below the $2,000 level at $1,771, which was a decline of around 9 percent over a 24-hour period. Others like Dogecoin and XRP Litecoin also showed very sharp declines.

The price drop in cryptocurrency is the direct result of the Chinese government taking strict action to prohibit the mining of these digital currencies. According to reports, the cryptocurrency mines in China power nearly 80 percent of the global trade of these currencies.

The Chinese government has announced its intention to restrict the trading and mining of Bitcoin.

Bitcoin had last traded below $30,000 at the end of January but over the next few months, it started to gain, but these gains were wiped out by nearly 35 percent in the month of May.

There are also reports that the People Bank of China had summoned the country’s largest banks and payment companies, urging them to crack down harder on cryptocurrency trading. The Sichuan province of China, which is home to 26 such mines, had ordered its closure as it requires a huge amount of power to mine the digital currency.

In recent times, the manner in which these cryptocurrencies are generated has come under increased scrutiny, especially on the issue of environmental safety as they use considerable energy which is supplied by coal-based power plants — which are seen as one of the major pollutants.

Edited by Kanishk Singh

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