The people’s bank of China has declared that all cryptocurrency transactions are illegal, do not have legal tender status and cannot be circulated as currency in the market.

The declaration has sent Bitcoin into a downward plunge of 5.5% at $41,000, while ether has plunged to 8.4% at $2824, according to CoinMarketCap.

The bank said that virtual currencies that are issued by non-monetary authorities using encryption technology, distributed accounts or similar technology, and exist in digital form, such as Bitcoin and Ethereum, cannot be circulated as currencies in the market.

It was further revealed that in recent years, Bitcoin and other virtual currency transaction activities have disrupted economic and financial orders, breeding money laundering, illegal fund raising, fraud and other illegal and criminal activities.

Despite the drop in crypto prices, some experts believe now is a good time to buy as they remain optimistic as to Bitcoin’s future.

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