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Bitcoin Price Falls Below $30,000 as China Shuts Down Mining Operations

Bitcoin price crash
(Image credit: Shutterstock)

China’s move to shut down cryptocurrency mining operations is having a profound effect on the crypto market. CoinDesk today reported that Bitcoin’s price fell below $30,000 for the first time since January as its value dropped by around 10% in 24 hours. Other cryptocurrencies followed suit.

This decline has all but undone the massive gains Bitcoin enjoyed for much of the year. Its per-coin price rose above $44,000 in February when Tesla acquired $1.5 billion worth of the cryptocurrency, and it established a new record high price of $64,000 after Coinbase was listed on the Nasdaq stock exchange on April 13.

That valuation didn’t last long—the price fell to roughly $47,000 just 10 days later as President Joe Biden considered new capital gains taxes. At the time of writing, the cryptocurrency is priced at about $29,700 per coin, according to the CoinDesk price index, which means it has lost more than half its value in just two months.

This drop has mostly been attributed to China’s new (or newly enforced) restrictions on cryptocurrencies. Mining operations throughout the country were shut down over the weekend, and on Monday, the People’s Bank of China forbid banks within the country from handling most transactions involving cryptocurrencies.

China was responsible for most of the world’s cryptocurrency mining; losing that production was bound to have an impact on the crypto market. It’s not just Bitcoin—the price of Ethereum has fallen more than 10% in the last 24 hours, too, and lesser-known cryptocurrencies have seen their values drop alongside those leading coins.

The crypto market isn’t the only one affected by these falling prices: Reports indicate that graphics cards prices have fallen as much as 45% in China as a result of the crackdown on cryptocurrency mining operations. Graphics card pricing has fallen in Europe, too, so there might finally be some (real-time ray traced) light at the end of the tunnel for enthusiasts who’ve been hoping to upgrade their systems with one of the best graphics cards. Fingers crossed!

  • peachpuff
    With less miners shouldn't the price go up? 🤔
    Btw wheres elon? Tweet some bitcoin goodness to get the price to go up!
    Reply
  • InvalidError
    peachpuff said:
    With less miners shouldn't the price go up? 🤔
    Most cryptos have variable difficulty to keep the rate at which new blocks are found roughly constant regardless of network hash rate. The hash rate going down by 50% would cause complexity to drop by ~50% and you'd get the same net mining rate except now the world as a whole is wasting half as much power and other resources on it.
    Reply
  • gargoylenest
    if it was a something tangible, that is how it works. But it works more like a pyramidal scheme, the more people want it, the more value it gets. remove a potential 1.5 billions people to the equation, and that is what happens.
    Reply
  • Integr8d
    gargoylenest said:
    if it was a something tangible, that is how it works. But it works more like a pyramidal scheme, the more people want it, the more value it gets. remove a potential 1.5 billions people to the equation, and that is what happens.

    You just described basic market economics; not a pyramid scheme.
    Reply
  • daworstplaya
    Integr8d said:
    You just described basic market economics; not a pyramid scheme.

    While his description is wrong, Crypto is still a pyramid scheme. It's not a "currency", it's not goods and services and it's not backed by anything. The only way to get it's value up, is to con others after you that it has value and the value is more than what you paid for it.
    Reply
  • InvalidError
    Integr8d said:
    You just described basic market economics; not a pyramid scheme.
    A pyramid scheme is when you sell something worthless to other people to scam them out of their money and then leave those people to figure out how to scam other people to offload their crap onto. Fits crypto which has absolutely no intrinsic value perfectly. The only way to make money from crypto is to con people into thinking it is worth more than you paid for.
    Reply
  • JamesJones44
    InvalidError said:
    A pyramid scheme is when you sell something worthless to other people to scam them out of their money and then leave those people to figure out how to scam other people to offload their crap onto. Fits crypto which has absolutely no intrinsic value perfectly. The only way to make money from crypto is to con people into thinking it is worth more than you paid for.

    While I 100% agree people who believe in Crypto are nuts, a Pyramid scheme is not about selling something worthless. It's about getting the people who come in after you to do the work for you while promising they will get what you get if the get enough people to join. Social Security in the US is a perfect example of a classic Pyramid scheme. As long as you have more people working than living of their retirement funds all is well, once that Pyramid starts to straiten, all hell breaks loose.
    Reply
  • Dean0919
    Hate this crypto crap. Because of that I can't buy video card because of their ridiculous price... I Really want this bitcoin crap to die one day.
    Reply