Cryptocurrency markets have seen intense levels of volatility with most large digital coins impacted. Miners have suspended Chinese operations as a crackdown in the country has deepened. This is having a huge effect on the performance of digital currencies across the board, but will the trend continue?
The crypto market remains uncertain in the way of mining operators including Huobi Mall, HashCow and BTC.TOP suspending their China operations.
The suspension was undertaken after Beijing ramped up its efforts to crack down on bitcoin mining and trading, causing the digital coin to plummet.
Cryptocurrency miners use increasingly powerful computer machines and equipment to verify virtual coin transactions in a process which produces newly minted cryptocurrencies such as bitcoin, dogecoin or Ethereum.
A State Council committee led by Chinese Vice Premier Liu He announced a crackdown on digital currencies late on Friday.
The move is being undertaken in a bid to fend off financial risks.
The crackdown is the first time the State Council has targeted virtual currency mining.
The crypto mining industry is a huge sector in China, which accounts for more than 70 percent of the world’s digital currency supply.
The country is seeking to clamp down on illegal activities across the securities industry while maintaining stock, bond and forex market stability.
The cryptocurrency exchange Huobi suspended mining and trading services to mainland Chinese clients on Monday.
The platform said it would instead focus on overseas business.
A general upsurge began for many cryptocurrencies on Saturday after SpaceX founder Elon Musk threw his support behind these digital currencies on Saturday.
Elon Musk tweeted his support for digital coins over fiat currencies.
Mr Musk tweeted: “The true battle is between fiat and crypto. On balance, I support the latter.”
His comments were made despite an announcement from Tesla revealing it was suspending purchases using bitcoin.
The statement read: “Tesla has suspended vehicle purchases using bitcoin.
“We are concerned about rapidly increasing use of fossil fuels for bitcoin mining.”