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Bitcoin climbed as high as $37,391 after falling some 7.5% a day
earlier, and was last up 5%.
Second-largest cryptocurrency ether jumped more than 10% to as
high as $2,321, erasing losses of 8.6% on Sunday that pushed it
to near a two-month low around $1,730.
The catalyst for the slump was cryptocurrency "miners", who mint
cryptocurrencies by using powerful computers to solve complex
maths puzzles, halting Chinese operations in the face of
increasing scrutiny from authorities.
The attention on Chinese miners - who account for some 70% of
supply - is the latest front in a wider push by Beijing against
the cryptocurrency sector.
Major cryptocurrency exchange Huobi on Monday suspended both
crypto-mining and some trading services to new clients from
mainland China, adding it would instead focus on overseas
businesses. Others also suspended business in China.
In the short-term, market players said, that is likely to lead
to pressure on prices as miners sell bitcoin held on their
balance sheets.
"If they are pulling up stakes or shutting down, they may need
to reduce their balance sheets in the short term," said James
Quinn, managing partner at Q9 Capital, a Hong Kong-based
cryptocurrency private wealth manager.
'TOUGH SPOT'
Crypto market players said fears over the China crackdown would
likely linger.
"We tend to expect some stabilisation over the next week, which
should translate into a bounce, but nobody's really sure about
what happens next," said Joseph Edwards, head of research at
crypto brokerage Enigma Securities.
"Crypto clearly finds itself in a tough spot in terms of the
narrative right now, and it's taken a lot of oxygen out of the
room."
Bitcoin had stabilised from a bruising week on Saturday after
Tesla boss Elon Musk - whose comments on cryptocurrencies have
been a key price driver in recent months - tweeted support for
crypto in "the true battle" with fiat currencies.
Yet after last week's 25% drop, triggered in part by toughening
language from Chinese regulators, bitcoin remains almost 45%
below last month's record high of $64,895.
Its slump has pulled bitcoin roughly back to its level before
Tesla unveiled in February a $1.5 billion bitcoin purchase and
made a since-reversed decision to accept it as payment.
Ether has fallen by half in just 12 days since its peak of
$4,380, with other smaller cryptocurrencies such as dogecoin
also suffering heavy declines.
(Reporting by Tom Wilson in London and Tom Westbrook in
Singapore; Editing by Sam Holmes, Robert Birsel)
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