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Bitcoin Falls on Reported Chinese Bank Ban; Crypto Stocks Drop

Bitcoin falls to a two-week low and cryptocurrency-focused stocks also drop after China's third-biggest bank bans customers from doing any business in crypto.

Bitcoin fell to a two-week low and cryptocurrency-focused stocks also dropped Monday as China intensified its cryptocurrency crackdown, with one of the country's biggest banks banning customers from doing any business in digital currencies.

Bitcoin was down 9% at $32,430 early Monday, while Ether was down 10% to $2,024. Cryptocurrency-exposed stocks including the likes of Riot Blockchain  (RIOT) - Get Report, Marathon Digital  (MARA) - Get Report, Coinbase  (COIN)  and Ebang  (EBON) - Get Report were also lower in premarket trading.

The latest crypto downdraft was sparked by reports that the Agricultural Bank of China, one of the country’s biggest banks, published a statement outlining a ban that prohibits customers from doing any business with cryptocurrencies.

According to the since-deleted statement, clients’ accounts will be terminated if the bank discovers they have had any interactions with Bitcoin or other digital assets. A translation of the statement was tweeted by Chinese journalist Colin Wu on Monday.

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Concern that China is increasing its crackdown on the use of digital currencies ahead of rolling out a digital version of the Chinese yuan also sent crypto prices lower on Monday. More localized efforts in China to rein in cryptocurrency mining further  pressured cryptocurrencies and related assets after a relatively calm period.

The crypto faithful are also grappling with a tumble in tokens used in so-called decentralized-finance - or DeFi - applications. DeFi apps let people lend, borrow, trade and take out insurance directly from each other using blockchain technology, without the use of intermediaries such as banks.

At last check, Bitcoin was down 2.5% at $32,954, while Ether was down 3.47% at $2003.96, its lowest level since May 23. Dogecoin was down 11.9% at 23.1 cents while XRP was down 3.98% at 68.42 cents.

Riot Blockchain shares were down 2.2%, while Marathon Digital stock was down 2.46%, Coinbase was down 3.4% and Ebang was down 7.37%.