As China increases crypto ban, Ethereum falls more than Bitcoin. ETH/BTC at 3-week lowest

As China’s move scares investors away, the second-largest cryptocurrency fell 13.30% against Bitcoin’s 9.38% drop. The price of Ethereum’s native currency Ether (ETH), fell Friday as China increased its crackdown on cryptocurrency transactions, declaring them illegal. “Financial institutions as well as non-bank payment institutions can not offer services to activities or operations related to virtual currency,” the People’s Bank of China stated in a statement posted on its website Friday. It also said that offshore crypto services offered to Chinese residents are illegal financial activities. In response, the bids for the ETH/USD pair fell by as much as 13.30% to $2735 Daily price chart for the ETH/USD Source: TradingView.comBitcoin, the world’s most popular cryptocurrency, fell from its WTD high at $47,358 down to $2,651. Its prices dropped by 9.38% on Friday, a huge intraday drop but less than Ether’s plunge in the same period. Even after the recent declines, ETH/USD’s year to date (YTD) gains were still above 280%. Bitcoin’s YTD profits were slightly less than 40%.ETH/BTC drops to multi-week lowsEther also fell against Bitcoin, with the ETH/BTC exchange rate falling to 0.066 BTC, its lowest level in over three weeks. The daily price chart for ETH/BTC shows the pair trading at 0.079 BTC, its yearly peak. Source: TradingView.comNonetheless, Ethereum charts suggest that Ether would grow stronger against Bitcoin in the coming sessions. This is primarily due to a Bull Flag formation at ETH/BTC market. A Bull Flag is a bullish continuation pattern that surfaces after a strong uptrend. The Flagpole sets its profit targets at length equal the Flagpole’s size if prices break above its channel’s upper trendsline. ETH/BTC could see a bullish breakout to reach its local high of 0.0824 BTC. However, bullish fundamentals remain. The Ethereum token is also expected to rise overall due to its growth in the emerging Decentralized Finance (DeFi) industry. Cointelegraph reported that the total value locked (TVL), for the decentralized applications industry, reached $142 billion in August 2021. 68% of this figure was concentrated on Ethereum. Evergrande contagion fears cause a 12.5% drop in ETH’s price. This increases Ether token demand for its ability to power smart contract that back dapps. However, active supply across the board expects a decline in ETH prices as holders continue to lock their ETH holdings to Ethereum’s proof of stake smart contract. This ensures more demand for Ether tokens for its ability to power smart contracts that back dapps. Source: CryptoQuantMore supply anticipates that a portion of the daily 13,000 Ethereum issuance that was issued by the Ethereum network following its August 5 London Hard Fork upgrade will be lost. WatchTheBurn reports that the network has burned 358 616 ETH worth more than $1 billion. You should do your own research before making any investment or trading decision.

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