For the first time in three months, the price of bitcoin has fallen below $34,000 (£24,030). The steep fall in price is after China imposed fresh curbs on crypto-currencies.
On Tuesday, Beijing banned payment companies and financial institutions from procuring services related to cryptocurrency transactions.
Moreover, it warned investors against speculative crypto trading.
It follows a fall in Bitcoin of over 10% last week. This was after carmaker Tesla said it would no longer accept the currency.
The cryptocurrency was down by 22% on Monday, a fall of around $6,000 in 24 hours.
Meanwhile, other digital coins such as Dogecoin and Etherium lost as much as 29% and 25%, respectively.
Moreover, Tesla’s shares on Wall Street on pre-marketing trading fell around 3%. This was probably because of the carmaker’s exposure to Bitcoin.
The firm owned by Elon Musk in early February bought cryptocurrency worth $1.5 billion.
China’s capital Beijing cracks down
Since 2019, cryptocurrency in China has been illegal to restrict money laundering. But people are still able to trade online in currencies like Bitcoin, which has concerned Beijing.
On Tuesday, three state-backed organisations issued a warning on social media. These organisations included the China Banking Association and the National Internet Finance Association of China. Also, the Payment and Clearing Association of China.
They said if investors were to incur any losses, they would have no protection from cryptocurrency investment transactions.
Adding that current wild fluctuations in cryptocurrency prices seriously violates people’s asset safety. Moreover, it is disrupting the financial and economic order.
Tesla snub
In March, Tesla owner Elon Musk surprisingly that the electric car maker would allow customers to buy Bitcoin.
But last week, due to environmental concerns, Mr Musk took a U-turn and suspended vehicle purchases using Bitcoin.
His fears centre on Bitcoin mining- the energy-intensive process using high powered computers through which the digital currency is generated.
Hence, it often relies on electricity generated with fossil fuels, especially coal.
He said they are concerned about the fast increasing use of fossil fuels for Bitcoin transactions and mining, especially coal. Adding Mr Elon Musk said it the worst emissions of any energy.
Although digital currency trading is illegal in China, more than 75% of Bitcoin mining worldwide is done in China.
