Bitcoin price collapsed below $40,000, which is the first time since February 9, 2021.

Currently, the price of the world’s largest cryptocurrency by market capitalization is estimated at about $39,600 according to coinmarketcap, which is the lowest point in 14 weeks.

As usual, altcoins with every strong decline of Bitcoin follow its movement first, as the price of Ethereum has dropped below $3,000 and is trading at $2,950 at the time of the article.

The decline of the cryptocurrency market in general continued over the past week and its decline extended further at the beginning of this week, here are some of the reasons that contributed to the decline of Bitcoin.

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What is the reason for Bitcoin dropping below the $40K level?

Elon Musk’s negative statements about Bitcoin and Tesla’s announcement to stop accepting Bitcoin as a method of payment made the Bitcoin move quickly towards the level of less than 50 thousand dollars, and fluctuates at 44 thousand-46 thousand dollars.

Another negative news that could be the main reason for bitcoin’s decline to its current levels is the confirmation by Chinese industry organizations of old restrictions on cryptocurrencies.

reveal The latest reports from China have confirmed that several authorities have confirmed their ban on Bitcoin as a means of payment and that financial institutions and payment companies are prohibited from providing banking services to cryptocurrency traders and related entities.

According to the original report from the Chinese authorities, the move stems from the high volatility of the cryptocurrency market.

Chinese institutions and bodies confirm their ban on dealing with Bitcoin:

In a joint statement issued by three industry organizations in the country, it was stated that the rise and fall of cryptocurrency prices is disrupting the normal economic and financial system.

According to the same report, the three industry bodies that have moved against Bitcoin recently are:

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• China Banking Association.
• National Internet Finance Association of China.
• China Clearing Association.

According to the statement, these organizations believe that cryptocurrencies are not backed by true value, in addition to the ease with which their prices can be manipulated.

With the restrictions in place now, not all financial institutions, including banks and other payment platforms, can offer their services to customers dealing with cryptocurrencies.

These services include registration, trading, clearing and settlement.

While China has banned banks from serving crypto institutions, investors and traders are not prohibited from engaging in the cryptocurrency category.

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Cryptocurrency traders in China just need to find a way to conduct their crypto activities without using banks, which is possible through P2P channels.

Meanwhile, China is not the first country to ban financial institutions from servicing cryptocurrency exchanges and related companies.

Earlier this year, Nigeria’s central bank banned banks from facilitating cryptocurrency transactions.

Despite the ban, several reports revealed that cryptocurrency trading volume in Nigeria continues to rise, thanks to P2P platforms.

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