China Says All Crypto Transactions Illegal; Bitcoin Tumbles

China’s central bank declared all transactions involving Bitcoin and other virtual currencies illegal, stepping up a campaign to block use of unofficial digital money.

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The notice complained Bitcoin, Ethereum and other digital currencies disrupt the financial system and are used in money-laundering and other crimes.

“Virtual currency derivative transactions are all illegal financial activities and are strictly prohibited,” the People’s Bank of China said on its website.

The price of Bitcoin fell more than 9%, to $41,085, in the hours after the announcement, as did most other crypto tokens. Ethereum skidded almost 10%, falling from $3,100 to around $2,800.