Cryptocurrency markets collapsed on Wednesday after Chinese regulators signaled crackdown on the use of digital currencies.

The news from China saw Bitcoin, the largest cryptocurrency, continue to decline at $ 38, down 11 percent today. It is down more than 30 percent in a week.

Bitcoin had already been put under pressure by a series of tweets from Elon Musk, CEO of Tesla.

Musk had announced that Tesla will no longer accept Bitcoin as a form of transaction.

Ether, the coin linked to the Ethereum blockchain network, also fell to $ 1,850, its weakest level since late January.

It had last dipped 26 percent to $ 2,497 since hitting a record high on May 12 and the ether dropped 57 percent.

The recent sell-off pushed the market capitalization of all cryptocurrencies to $ 1.7 trillion from a record $ 2.5 trillion earlier this month.