Bitcoin, ethereum, cardano and dogecoin have all tumbled in price on Wednesday after China announced measures to block cryptocurrencies from being used as a form of payment in the country.
The move saw bitcoin fall below $40,000 for the first time since February, while other leading cryptocurrencies saw their values drop by between 15 and 20 per cent overnight.
It follows a tough few days for the crypto market, with a massive sell-off initially sparked by Elon Musk’s tweet that Tesla would no longer be accepting bitcoin payments.
The news from China means financial institutions and payments companies will no longer be allowed to provide services relating to cryptocurrency transactions. Regulators also warned investors about the volatility of the cryptocurrency market.
“Recently, crypto currency prices have skyrocketed and plummeted, and speculative trading of cryptocurrency has rebounded, seriously infringing on the safety of people’s property and disrupting the normal economic and financial order,” a statement read.
