Cryptos Keep Getting Increasing Attention from Both Ordinary Users and Powerful Financial Regulators

China is intensifying its crackdown on cryptocurrencies. According to CNN, Chinese government agencies including the country's securities regulator and the People's Bank of China (PBOC) declared in a recent joint statement that all cryptocurrency-related business activities are illegal and promised to shut down “all illicit activities involving digital currencies”. The National Development and Reform Commission said in a separate statement, that China will seek to gradually start shutting down crypto mining operations, and no new mining projects will be permitted. It seems like they are not satisfied with the outcome of their previous efforts in cracking down on crypto mining.

The Celestial Empire’s agencies outlined that overseas crypto exchanges would be blocked from providing services to Chinese residents through the internet saying that China must develop "new systems to counter risks posed by cryptocurrencies”. And this is happening in the depths of Evergrande’s default crisis! As a result, breaking its ascension trend, Bitcoin (BTCUSD) today abruptly fell about 5% on the news. Ethereum (ETHUSD), the second most important benchmark cryptocurrency, was down 9%.

Earlier the U.S. Securities and Exchange Commission Chairman Gary Gensler was grilled by the lawmakers in Washington vowing to “work overtime to create a set of rules to oversee the unsettling cryptocurrency markets (while balancing the interests of American innovators)”. Sounds like a tricky but noteworthy mission.

Gensler told the Senate Banking Committee that his and his team’s primary goal is to “protect investors through better regulation of the thousands of new digital assets and coins”, as well as to oversee the “more-familiar Bitcoin and Ether markets”. Leading cryptos are now obtaining really caring parents across the globe! The SEC chief, however, noted the “enormity of the task” (read: the task is indeed overwhelming), telling Sen. Catherine Cortez Masto, D-Nev., that the regulator could use “a lot more people” to evaluate the 6,000 “novel digital “projects”” (“too many to count and still counting”) and “determine whether they all qualify as securities under U.S. law” (“we do really need more people to join us as helpers”).

To be fair, for the past year, there has been a decisive shift in the cryptocurrency market from speculation to the common acceptance of its substantiality. Blue-chip coins such as Bitcoin, Ethereum, Solana (SOLUSD) and Doge (DOGEUSD) have been steadily growing in terms of transaction amounts, steadily increasing number of private wallets, and organic growth in users, developers, and high-value investors. We must admit, that despite occasional negative non-material news where bad actors try to destabilize these markets, the crypto market is gradually maturing, and quality projects are decoupling themselves from toxic mindless speculative trading practices. Specifically, Bitcoin’s on-chain analytics and recent price movements indicate that the era of ‘price cycles’ and intense volatility may finally be coming to an end. Going forward, user adoption should support Bitcoin's growth more than anything else.