Bitcoin drops below $30,000 for first time since January

Bitcoin (Image: Reuters)

Bitcoin fell below $30,000 for the first time in nearly five months as China's latest crackdown on cryptocurrencies weighed. The world's largest cryptocurrency tumbled by as much as 8.5% to $29,766.87, its lowest since January 27, reported at around 7 pm (IST). As of 1232 GMT it was down 4.2%.

The market capitalisation of the most popular cryptocurrency declined to $557.89 billion during the 24-hour trading, according to coindesk.com.

Earlier in the day, the bitcoin opened at $32,475.47, while the 24-hour low was registered at $29,350.33 on Tuesday. However, the highest value of the cryptocoin was reported as $33,247.79 in the 24-hour trade.

Crypto carnage | Bitcoin forms widely followed technical sell signal 'death cross', indicates more downside ahead

During the weekend, the cryptocurrency triggered a technical sell signal, and following this, trade experts indicated more downside ahead.

Bitcoin experienced a bearish "death cross" which occurs when the 50-day moving average (DMA) dips below the longer-term 200-day moving average. The signal is widely followed by technical analysts and traders.

Meanwhile, China escalated its crackdown on Bitcoin by further curbing mining activity and telling major payments platforms and lenders that crypto trading won't be tolerated, reported CNN.

With Chinese authorities signaling a more aggressive push to curtail use of crypto currencies for months now, the prices have fallen. On Monday, the People's Bank of China the widely popular online payments platform run by Jack Ma's Ant Group -- Alipay and five big lenders and told them "comprehensively investigate and identify" cryptocurrency exchanges and dealers so they could cut off any crypto trading, added the daily.

"Cryptocurrency trading and speculative activities ... breed the risks of illegal cross-border transfers of assets and money laundering," CNN quoted the Chinese central bank as saying.

Chinese state media outlet -- Global Times -- reported that more than 90 percent of China's bitcoin mining capacity would be shut down on Monday.

Though China doesn't completely ban cryptos, its regulatory bodies in 2013 had declared that bitcoin was not a real currency and forbade financial and payment institutions from transacting with it. Citing risk of money laundering, while stating the importance of maintaining financial stability and protecting Yuan's status, the regulators forbade financial and payment institutions from transacting with bitcoin.

ZebPay Co-CEO Avinash Shekhar sees the falling value of Bitcoin in recent days as a good sign of the market still holding a positive sentiment.

"No one can predict the market or define if we have entered the bear market. Crypto markets overall have seen significant gains over the last 6-9 months despite the recent dip in prices. But, the market is still sustaining very well above the 2017 all-time high prices. This is a good sign of the market still holding a positive sentiment. We are looking forward to the upcoming upgrades to different blockchain networks and might see more fundamental strength in this space leading to sustainable growth in the future," he said.