China rules all cryptocurrency transactions illegal

China’s central bank announced Friday that all cryptocurrency transactions are illegal, citing price volatility and potential national security risks.

Ten other government agencies also pledged to maintain a crackdown on all trading in the country.

Banks and nonbanking payment institutions in the country will be barred from providing crypto services.

The People’s Bank of China’s lengthy statement said that cryptocurrency has disrupted the financial order and been a breeding ground for “illegal and criminal activities such as gambling, illegal fund-raising, fraud, pyramid schemes, and money laundering.”

The value of Bitcoin, which was mentioned by name in the statement, was down 8 percent as of Friday morning. Ethereum, the second largest digital asset, had a similar decrease in value.

China will also pursue new action against crypto mining, an energy intensive process by which new coins are produced.

The Chinese Communist Party has previously flirted with the idea of cracking down on cryptocurrencies, but Friday’s statement goes further and shows significant cooperation across government on the issue.