Prices on cryptocurrency platforms Bitcoin and Ether have been volatile in recent weeks after China’s central bank recently stated that all cryptocurrency-related activities were illegal. That is widely seen as the county’s effort to curb currency manipulation, flight of capital, and technology-related risks it perceives in cryptocurrencies. But it would be “dangerous” to assume that the decline and volatility in cryptocurrency prices are a result of China’s ban, according to Kevin Werbach, Wharton professor of legal studies and business ethics.

In a recent interview on the Wharton Business Daily radio show on SiriusXM, Werbach pointed to numerous other factors that shape cryptocurrency prices. The evolution of cryptocurrencies will be shaped by choices countries make on how to use them (e.g., as a digital asset or as a currency, or both) and the attendant regulation, he said. They are not about to become globally accepted as yet, even as some countries have embraced them; recently, El Salvador adopted Bitcoin as its currency and Switzerland cleared the way for more trading of Bitcoin and other digital assets in the country.

An edited transcript of the conversation follows.

Wharton Business Daily (WBD): How surprising was it to hear about the People’s Bank of China banning cryptocurrency transactions?

Kevin Werbach: It was not surprising at all. China has been strictly regulating and limiting cryptocurrency activity for a number of years. In 2017, it banned exchanges operating in China. It also banned initial coin offerings where companies