Cryptocurrency Markets Tank After Signs China Could Push Out Miners (Updated)

January 8, 2018, 4:49 PM UTC

Every major cryptocurrency has seen broad losses over the last 24 hours before signs of a slight recovery late Monday morning. The pummeling came after news that China may apply regulatory pressure to force cryptocurrency operations there to close.

Bitcoin dropped as much as 18% from a Sunday high, while Ripple (XRP), which had recently surged, fell as much as 35%. All of the top 15 cryptocurrencies fell, though Ethereum has seen the strongest rebound, retaking its position as the second-largest cryptocurrency by total market value. (All prices per CoinMarketCap – see update below).

The prices of top cryptocurrencies dropped sharply late Sunday into Monday morning, shown here on Coinmarketcap’s ticker.Coinmarketcap

Such swings aren’t unusual in the cryptocurrency market, and the last month has seen broad profit-taking after historic late-December highs. But the latest dip comes on the heels of the staggering possibility that China, home to the bulk of the world’s Bitcoin and cryptocurrency servers, could push to shut down those operations.

Bloomberg reported last week that China could limit the power supply to some Bitcoin servers, also known as “miners.” They have blossomed in the country because of an abundance of cheap hydroelectric and coal power.

Get Data Sheet, Fortune’s technology newsletter.

Today, Quartz reported on leaked documents showing that China’s Internet-finance regulatory group would push local governments to constrain cryptocurrency miners in order to force an “orderly exit” from the business. Government concerns apparently include waste of resources and the possible financial fallout of a major cryptocurrency crash.

The documents, from China’s Leading Group of Internet Financial Risks Remediation, asked local authorities to leverage not just electricity prices, but also land use, tax, and environmental regulations to pressure miners to leave the business. An official contacted by Quartz confirmed the authenticity of some of the documents, but wouldn’t comment on others.

The majority of the world’s Bitcoin mining is located in China, and the effects of even an “orderly exit” are unclear. Some Chinese cryptocurrency mining operations are already moving out of the country, but they may not be able to reproduce the cost advantages they had in China.

The Bitcoin protocol, and most other cryptocurrencies, are designed to increase incentives for miners when there is a decline in overall power on the network, so at least in theory, the decline of Chinese mining power could create an opportunity for new operators elsewhere. That could actually be good for the long-term health of the ecosystem, whose proponents have long been anxious about the risks of the concentration of miners in a single, often opaque authoritarian state.

Update 1:36 EST: Late Monday morning, CoinMarketCap announced that it had removed a number of Korean cryptocurrency exchanges from its indexes because of “extreme divergence in prices from the rest of the world and limited arbitrage opportunity.” The delisting, which was made without prior announcement, appears to have taken place at midnight on Sunday U.S. EST. Some of the price drops discussed above were amplified by the change.

Subscribe to Well Adjusted, our newsletter full of simple strategies to work smarter and live better, from the Fortune Well team. Sign up today.