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Early 24th September, Bloomberg, one of the largest online news outlets, released fake news that drove crypto prices down. In the news, Bloomberg said that China’s PBC termed all crypto transactions illegal. However, while the memo is available on the PBC website, the central bank originally on 15th September.
Bloomberg Reports China’s Crypto Bann
China continues to add on its unrelenting determination on the crackdown against digital currencies in the country. The People’s Bank of China (PBC) takes an aim against cryptocurrencies by announcing that all crypto-related transactions are illegal.
According to a report by Bloomberg, China’s central bank declares all crypto transactions illegal in the jurisdiction. PBC considers cryptos as the source for conducting illegal financial activities. Furthermore, it has banned financial institutions from providing any cryptocurrency services.
The PBC proves its determination to crackdown cryptos from a current Q&A statement on their website. It was about joint government guidelines on cracking down on cryptocurrency trading and speculation risks. The PBC stated that all coins like Bitcoin and Tether are not fiat money and cannot circulate on the market.
It further stated that all crypto-related transactions are illegal financial activities. Moreover, any transactions between offshore exchanges and domestic residents are also illicit financial activities.
Apart from the crypto ban, China has been the home of development in crypto recently. China has been in a crackdown against crypto recently. China’s economic planning agency mirrors the move as a vital mission for China to eradicate crypto mining. The agency also added that the crackdown is crucial for the nation to meet carbon goals soon.
In the wake of China’s global limelight over a debt crisis involving property developer China Evergrande Group. This has caused unease on international markets. Furthermore, the state still proceeds with its crackdown. The Evergrande news received recent comments from the SEC and the overall macro environment. As a result, it initiated a tense atmosphere in the crypto community.
China’s PBC is Old News
Bloomberg’s posted news was fake and old. In fact, on their Twitter page, Bloomberg posted the headline and received criticism from the crypto community. Some claimed that the information posted was from 2017 when the government truly made the remarks.
Others termed the news as outdated. Some mentioned that the same document initially appeared on the website on 15th September, but reposted today. The memo that PBC posted today was already online ten days ago.
On Twitter, several people criticized Bloomberg, saying that Bloomberg has a role in China’s crypto crackdown. In the past, Bloomberg criticized crypto’s volatility on negative news. However, it’s actively participating in increasing crypto volatility. Bloomberg reposted the same statement to stir issues in crypto markets.
Why Investors Need to Brace Themselves
This news caused a colossal sell-off in digital currencies worldwide. For example, Ether dropped drastically, and Bitcoin plummeted over 4.5% on Friday, together with other crypto-related stocks.
According to Antoni Tranchev, co-founder of crypto lender Nexo, all crypto enthusiasts need to look out for abrupt crypto price movements.
Tranchev stated that investors should expect immediate price reactions as China takes the wind out of Bitcoin’s sails. He also believed that the recent rebound from just below $40,000 has likely run down for now.
China’s move follows its continuous thirst to crack down on crypto, which kick-started in March this year. However, Bloomberg’s posting of the old news was a clear way to undermine the dependability of crypto.