On Friday, Chinese Vice Premier, Liu He who chairs the State Council’s Financial Stability and Development Committee announced that China will crackdown on bitcoin trading and mining because of the financial risks that the digital currency poses.

Bitcoin prices fell sharply and continued to fall throughout the weekend. At the time of writing, Bitcoin had slightly retraced to trade at $36,501.51 after dropping to $31,227.34 on Sunday. The digital currency has now lost almost 50% of its value from its all-time high.

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Besides, cracking down on Bitcoin mining and trading, the committee also said there would be a crackdown on illegal activities in the forex, securities, stocks, and bond markets to maintain stability in the markets.

Crypto mining in China accounts for 70% of the world’s crypto supply

Crypto mining is a booming business in china and it accounts for the largest percentage of cryptocurrency mining in the world, which accounts for the huge impact the announcement had on the cryptocurrency market as cryptocurrencies dropped sharply.

Liu is the first senior government official in China to publicly go after Bitcoin and it is the first time that the state council has targeted cryptocurrency mining activities in the country.

It is, however, a part of a wide-scale crackdown of cryptocurrencies after Beijing banned cryptocurrency exchanges in 2017.

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Crypto miners halt businesses in China

Several large cryptocurrency miners including HashCow, BTC.TOP, Huobi Mall has announced they are halting operations in China with some like Huobi Mall saying that they shall focus on overseeing markets.

Huobi Mall wrote on its Telegram community channel, “Meanwhile, we’re contacting overseas service providers, to pave way for exports of mining rigs in the future,” and asked its clients “not to worry and calm down”

BTC.TOP founder, Jiang Zhuoer, also said via Weibo that the mining pool would mainly be conducting business in North America in future

Jiang went ahead to write, “in the long term, nearly all of Chinese crypto mining rigs will be sold overseas, as Chinese regulators crackdown on mining at home,” he continued to say, ”Eventually, China will lose crypto computing power to foreign markets as well,” as he predicted the rise of European and US mining pools.