Bitcoin briefly falls beneath $ 60,000 as main cryptocurrencies fall
A “Buy Bitcoin Here” sign will be posted in a 7-Eleven store on November 10, 2021 in Los Angeles, California.
Mario Tama | Getty Images
Bitcoin and other cryptocurrencies fell sharply on Tuesday, pulling back from their record highs.
The world’s largest digital coin briefly fell below $ 60,000 during morning trading in London and temporarily slipped to $ 58,702.
It later made up for some of those losses, trading at $ 60,066 at 8 a.m. ET, 6% less than 24 hours earlier, according to Coin Metrics data.
Ether, the second largest cryptocurrency, fell 7% to $ 4,236.
The impetus behind the price move was not clear.
China’s state planner, the National Development and Reform Commission (NDRC), said during a press conference Tuesday that it would continue to clean up virtual currency mining in the country.
China cracked down on Bitcoin mining earlier this year, resulting in an exodus of miners. Mining is the energy-intensive process in which new coins are created and all transactions of existing digital tokens are logged.
Beijing is concerned about the amount of energy that mining uses.
Mining “causes high energy consumption and CO2 emissions. It has no active influence on the development of industry or scientific progress,” said NDRC spokeswoman Meng Wei on Tuesday, according to a CNBC translation of her Mandarin comments.
“The regulation of cryptocurrency mining activities is of major importance for optimizing our industrial structure, saving energy and reducing emissions, as well as achieving CO2 emissions and neutrality targets.”
China’s President Xi Jinping said last year that China aims to be carbon neutral by 2060.
The NDRC said it would focus on state-owned companies involved in cryptocurrency mining. It also said it is considering imposing “penalty electricity prices” on those who participate in cryptocurrency mining activities but pay a household electricity price.
China’s authorities have been focusing on eradicating bitcoin mining since the beginning of this year.
Read more about cryptocurrencies from CNBC Pro
Retreat from record highs
The decline in cryptocurrency prices also comes as many of them hit all-time highs in November.
Bitcoin hit a record high of $ 68,990.90 on November 10, followed by ether on November 11.
“I think we’re seeing a healthy retreat after a 7-week rally from 40,000 to 69,000, which is normal on an uptrend,” Vijay Ayyar, head of Asia Pacific at Luno cryptocurrency exchange, emailed CNBC.