What's happening in the cryptocurrency market? Chain of disasters between major currencies and platforms

The week is becoming a stock market cataclysm for major cryptocurrencies, a concatenation of events and falls on the stock exchange that is dragging most currencies like Bitcoin, Ethereum, or Dogecoin.

Bitcoin has fallen in the last 7 days more than 22% and Ethereum more than 33%. The main cryptocurrency on the market, Bitcoin, was a month ago against $65,000, but now its value is 33,000. A hit that has sharpened in recent weeks along with the fall of the rest of the currencies.

Strange as it may seem, the fault of this widespread collapse is not all of Elon Musk's tweets. The tycoon kicked Bitcoin a few days ago after announcing that Tesla would allow cars to be purchased with that coin, claiming it was bad for the environment, something that has been reported for several years. This change of course caused a major drop in Bitcoin, but it is not solely responsible for those that happened with the rest of the market.

China appears to be the main source of this new stock market shake. The country's main financial institutions have ratified their refusal to work with these currencies. The National Internet Finance Association of China, the China Banking Association, and the Payment and Clearing Association of China have simply corroborated compliance with the 2013 and 2017 ban by which China considers cryptocurrencies and ICOs illegal.

Mercado Criptodivisas 20-5-21

At the time, this decision also wreaked havoc on the market, so it should now come as no surprise. More than two years ago, the People's Bank of China stressed that it would pursue the sale of these currencies in the country. Of course, China has become a heavyweight to these economic interactions in recent years.

recent report states that bitcoin accounted for more than 75% of hash power or calculations, resulting in the issuance of 130.5 million metric tons of carbon emissions by 2024 alone by bitcoin extraction if they do not implement stricter regulations and policies. According to Statista, the market share of cryptocurrencies in China is much higher than that of the United States where there are no such restrictions, 65% compared to 7.24% in the US.

Ethereum gráfica

Looking at these numbers, it is understood that the reaffirmation by the Government and major banks in banning this market has been a blunt blow to the confidence of cryptocurrencies, and we already know that the stock market depends heavily on that trust. Other currencies such as Dogecoin or Shiba have also lost up to 70% of their value.

Bounce on platforms

Add to this the rebound it has caused on cryptocurrency trading platforms. Coinbase, for example, has suffered crashes and did not let its customers operate a few hours ago: "We are detecting some problems in Coinbase and Coinbase Pro and we are aware that some functions may not work fully normally. We are investigating those issues and will provide updates as soon as possible," they explained.

Binance, another of the big exchanges, also suffered blockages. They claim to be caused by network congestion, but it could be an alternative to mitigate the blow to the panic generated by falls among all cryptocurrency users and owners.

$ETH and ERC20 withdrawals are temporarily disabled due to network congestion. Thank you for your patience and apologies for any inconvenience caused. pic.twitter.com/BbECDgDUay— Binance (@binance) May 19, 2021

If we add to this chaos a de-execution of BlockFi, another platform of sale, which sent rewards of 700 bitcoins by mistake. The affected company now threatens to take legal action if they do not return those funds. It's being a nightmare week for the whole market that was already quite volatile in itself.

In the latest data, it seems that Bitcoin and the others will be able to recover some of the lost value in the last 7 days as shown in the CoinMarketCap charts, but it is still too early to assess the impact received by decisions in China and whether the fall may be greater or stay in a bad week.

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