* Broad Sunday selloff leaves sector struggling for breath<\/p>\n
* Miners suspend China operations as crackdown deepens<\/p>\n
* Bitcoin steadies around $35,700, Ether at $2,100<\/p>\n
SINGAPORE, May 24 (Reuters) – Cryptocurrencies fought to find a footing on Monday after even weekend cheerleading from Tesla boss Elon Musk seemed unable offset selling pressure from spooked investors or nerves stemming from a gathering crackdown on the asset class in China.<\/p>\n
Musk had lent a bid on Saturday by tweeting support for crypto in \u201cthe true battle\u201d with fiat currencies.<\/p>\n
But on Sunday prices slumped as \u201cminers,\u201d who mint crypto by verifying transactions, halted Chinese operations in the face of increasing scrutiny from authorities.<\/p>\n
Bitcoin climbed as high as $35,970 from Sunday\u2019s trough at $31,107, but the growing sense of a shakeout flowing through the frothy market left it struggling to make further gains and it remains some 45% below last month\u2019s record peak of $64.895.<\/p>\n
The collapse leaves the world\u2019s biggest cryptocurrency back where it traded in February, before Tesla announced a $1.5 billion bitcoin purchase and made a since-reversed decision to accept it as payment for cars.<\/p>\n
Rival crypto currency ether hit an almost two-month low around $1,730 on Sunday and bounced as high as $2,101 on Monday before losing some steam. Dogecoin, launched as a parody before Musk\u2019s backing vaulted it up more than a hundredfold this year, last traded at $0.30.<\/p>\n
\u201cAfter a brief bounce off last week\u2019s multi-month lows, some of the paper-handed types have seemingly sold-out,\u201d said IG Markets\u2019 analyst Kyle Rodda, using the market term for short-term holders who sell at the first signs of trouble.<\/p>\n
\u201cOr (they) decided to pack it in and cut their losses,\u201d he said, \u201cas Bitcoin\u2019s momentum, and the speculative mania that drove it, almost entirely disappears.\u201d<\/p>\n
The trigger for the initial crypto selloff appeared to come from toughening language from Chinese regulators last week, which stepped up further on Friday when a State Council committee vowed to crack down on miners in particular.<\/p>\n
Gravity has also played a role after months of gains and the attention on Chinese miners – who account for some 70% of supply – has further dampened sentiment.<\/p>\n
\u201cMany miners keep much of the bitcoin\/ETH etc that they mine and don\u2019t hedge it all into fiat right away,\u201d said James Quinn, managing partner at Q9 Capital, a Hong Kong-based cryptocurrency private wealth manager.<\/p>\n
\u201cIf they are pulling up stakes or shutting down, they may need to reduce their balance sheets in the short term.\u201d<\/p>\n
Late on Sunday, Huobi Mall, part of cryptocurrency exchange Huobi, said on Monday it suspended crypto mining that services mainland Chinese clients. BTC.TOP, a crypto mining pool, has suspended its China business citing regulatory risks, while crypto miner HashCow said it would halt buying new bitcoin rigs.<\/p>\n
Crypto miners use increasingly powerful, specially-designed computer equipment, or rigs, to verify transactions in a process that produces newly minted crypto currencies.<\/p>\n