China Bans Crypto... Again

Key Takeaways

• Crypto markets sell-off following regulatory news out of China, as the PBoC released a document laying out its intentions for stricter regulation and enforcement measures on crypto.
• This is not the first time China has “banned” crypto (and probably won’t be the last). Historical price movement post-ban is mixed.
• This news might serve as an alternate explanation for some of the outsized volume from Asian exchanges earlier in the week.
• $38,000 appears to be a critical support level based on on-chain data.
• A similar ban in 2017 preceded a run to all-time highs for BTC and ETH.
• The Bottom Line: We continue to monitor underlying market data for indications of sustained weakness, but for now we continue to buy into any selling as we maintain that a risk-on equities market could still result in a run to all-time highs for BTC and ETH.

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Crypto markets once again suffered an overnight blow from regulatory news out of China, as the PBOC released a document laying out its intentions for stricter regulation and enforcement measures on crypto. The document stated that all fiat-to-crypto and crypto-to-crypto transactions are deemed illegal and that there will be a cross-functional effort among most major Chinese state authorities, including the PBoC, the Cyberspace Administration o...