Ethereum
$4,156.72 1.66%
ETH · 4w

Ethereum drops more than Bitcoin as China escalates crypto ban, ETH/BTC at 3-week low

The price of Ethereum's native token Ether (ETH) crept lower Friday after China extended its crackdown on cryptocurrencies by deeming their transactions to be "illegal."

"Financial institutions and non-bank payment institutions cannot offer services to activities and operations related to virtual currencies," the People's Bank of China said in a statement on its website Friday, adding that online crypto services to Chinese residents offered by offshore exchanges are also "illegal financial activities."

Bids for the ETH/USD pair dropped by up to 13.30% to $2,735 in response. At its week-to-date (WTD) high, traders paid as much as $3,346 for a single Ether token but the price fell to as low as $2,651 after a tumult in China's heavily indebted property sector hit crypto markets.

ETH/USD daily price chart. Source: TradingView.com

As a result, Bitcoin (BTC), the world's leading cryptocurrency, also fell from its WTD high of $47,358 to as low as $2,651. Meanwhile, its prices fell by 9.38% on Friday—a massive intraday decline but lower than Ether's drop in the same period.

So it appears that traders decided to dump the digital assets that posted better long-term profits than Bitcoin. For instance, even after the latest declines, ETH/USD's year-to-date (YTD) gains came out to be above 280%. In contrast, Bitcoin's YTD profits were a little over 40%.

ETH/BTC falls to multi-week lows

Ether also underperformed directly against Bitcoin, with the ETH/BTC pair falling to 0.066 BTC for the first time in more than three weeks. At its yearly high, the pair traded at 0.079 BTC.

ETH/BTC daily price chart. Source: TradingView.com

Nonetheless, Ethereum charts suggest that Ether could grow stronger against Bitcoin in the coming sessions. This is due mainly to a Bull Flag formation in ETH/BTC market, a bullish continuation pattern that surfaces when prices consolidate lower/sideways (FLAG) following a strong uptrend (FLAGPOLE).

A Bull Fl...

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