Ethereum is plunging on Thursday afternoon, trading down over 17% to $228 per token, following reports that Chinese regulators are taking steps to shut down the country’s bitcoin exchanges and possibly ban all trading of digital coins.
BTC China, the second largest Chinese bitcoin exchange, tweeted Thursday that it would stop trading of bitcoin on September 30.
“After carefully considering the announcement published by Chinese regulators on Sept. 4, BTC China Exchange will stop all trading on Sept. 30,” the exchange said.
On September 4, Chinese regulators deemed initial coin offerings, a red-hot cryptocurrency-based fundraising method, illegal. ICOs often run on ethereum’s blockchain to create new cryptocurrencies.
In an ICO, a company issues a new digital currency that can either be spent within its ecosystem, a bit like Disneyland dollars, or used to power part of the business. They have helped some companies raise millions of dollars in a matter of seconds.
Ethereum has been sliding since the announcement of the Chinese ICO ban.
Yicai, a Chinese news outlet, has reported China plans to shut down the country’s cryptocurrency exchanges by the end of the month, according to Reuters. The website Crypto Coins News on Thursday morning reported on a local newsletter that said banning exchanges was “certain.”
In February, China blocked traders from withdrawing their bitcoin. They were eventually allowed to resume withdrawals in June.
The cryptocurrency market has come under pressure as of late. Its market cap has slumped nearly $60 billion from its record high at the beginning of September to $110 billion on Thursday.