Image Credit: Flickr user Marco Verch / CC 2.0 License

Cryptocurrencies have been making their way into the mainstream slowly and steadily, and today, we see more and more organizations opening up to this new technology-be it El Salvador or Twitter. In fact,  Elon Musk had deemed that it would be the currency of the future. Despite this, cryptocurrency continues to have its skeptics, and Asian giant China is one of them. The country has opposed cryptocurrency, especially Bitcoin, for quite some time, and on Friday the People’s Bank of China declared all transactions related to cryptocurrency, including services provided by offshore exchanges to domestic residents, to be illegal and vowed to crack down on the crypto market.

According to China’s central bank, all services which offered trading, order matching, token issuance, and derivatives for virtual currencies were strictly prohibited, and transactions related to cryptocurrency must be banned. Bitcoin’s price dropped by around 5% after the announcement was made and was last trading at around $42,378, while Ethereum’s price fell over 8% to $2,868.

This means that no cryptocurrency can be circulated in the Chinese market and financial institutions, payment companies. Moreover, internet firms will be restricted from facilitating the trading of cryptocurrency in the region. The central bank will maintain a “high-pressure” crackdown on speculative trading of cryptocurrencies, while the government will “resolutely clamp down on virtual currency speculation, and related financial activities and misbehavior in order to safeguard people’s properties and maintain economic, financial, and social order,” the PBOC said. It also added that it has improved its systems to step up monitoring of crypto-related transactions and root out speculative investing.

“Crypto markets are in an extremely frail state overall, and these sorts of downswings speak to that; there’s a degree of panic in the air,” said Joseph Edwards, head of research at cryptocurrency broker Enigma Securities. “Crypto continues to exist in a grey area of legality across the board in China.”

This comes just a few hours after Twitter, one of the biggest social media platforms in the world, opened up the opportunity for users around the world to tip influencers using Bitcoin.

One thing is for sure – things may have got easier for cryptocurrency (Bitcoin in particular) in one part of the world, but it still has a long way to go before the fight is over.