The price of Ether, the token currency of Ethereum, went down on Friday after China increased its cryptocurrency crackdown. This came to be after the country’s government considered the transactions made through digital currency as illegal. In a statement made by the People’s Bank of China, it was mentioned that most financial institutions and non-bank payment institutions won’t be offering services to operations and activities which are related to digital currencies.
They then added that the online services of cryptocurrency to Chinese residents were offered by offshore exchanges- something that was thought of as illegal financial activity.
It was further reported that the bids made for the ETH/USD pair went down by 13.30% to a price of $2,735 in response to this crackdown. As the week-to-date high increased, most traders went on to pay as much as $3,346 for a single token of Ethereum but then the price went down to a low of $2,651 after a kerfuffle in the indebted property sector of China hit the cryptocurrency sector.
Ethereum and Bitcoin fall to multi-week lows
Ethereum also underperformed directly against its main competition, Bitcoin, with the ETH/BTC pair going down to a sum of 0.066 BTC for the very first time over a course of three weeks. At its highest point this year, the pair was trading at a price of 0.079 BTC. Yet, data about Ether suggest that the cryptocurrency could come back stronger against Bitcoin in the next few sessions.
And this could be caused due to a formation of a Bull Flag in the market, which is simply a continuation pattern- bullish in nature- that usually came about when prices consolidated lower.
At the same time, the token of Ethereum is also expected to increase overall due to the growth in the sector of DeFi. As it was reported by Cointelegraph, the TVL for the sector reached a price of $142 billion.