Bitcoin slides under USD40,000 after China’s new crypto ban

Bitcoin, the biggest and best-known cryptocurrency, had already been under pressure from a series of tweets from Tesla boss Elon Musk, but the news from China sent it as low as $36,250, a 15 pc drop in the trading session.

The cryptocurrency has tumbled 40 pc from a record high of $64,895 hit on April 14. It is also heading for its first monthly decline since November 2018.

Bitcoin’s decline whacked other crypto assets, with Ether, the coin linked to the ethereum blockchain network, shedding as much as 28 pc on Wednesday to $2,426. It brings losses in the week since it hit a record high on May 12 to 40 pc. Meme-based dogecoin also tumbled – losing nearly 30 pc at one point, according to market tracker Coingecko.

Shares in the crypto exchange Coinbase dropped 5 pc in pre-market trading. Coinbase’s share price has nearly halved from the peak hit on the day of its direct listing in April. Cryptocurrency price declines last week were sparked by Musk’s reversal on Tesla accepting bitcoin as payment. His subsequent tweets caused further confusion over whether the carmaker had shed its holdings of the coin.

China’s latest announcement banning financial institutions and payment firms from providing services related to cryptocurrency transactions exacerbated selling. It also warned investors against speculative crypto trading.