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South Korea moves to ban cryptocurrency trading and Bitcoin prices plummet

by | 11 Jan, 2018

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The South Korean government is pushing for greater regulatory oversight of the flourishing cryptocurrency market

Bitcoin prices slipped below $13,600 today after the South Korean government announced a bill was being prepared to ban cryptocurrencies being traded through exchanges. 

The South Korean justice minister Park Sang-ki said virtual currencies were causing the government “great concern”.

Amid a broader crackdown on the crypto space, authorities from the National Tax Service also visited the country’s second-largest virtual currency operator, Bithumb concerning an investigation into alleged tax evasion, according to Reuters.

The step is one of many taken by the South Korean government to regulate the asset class more closely and protect investors, and banks are also in the firing line. 3 days ago the country’s Financial Services Commission announced joint investigations into 6 commercial banks offering trading accounts to cryptocurrency exchanges in the country, citing concerns about money laundering.

Cryptocurrencies are hugely popular in Asia. In November 2017, Japan, South Korea and Vietnam accounted for 80% of global bitcoin trading, according to the Asia Times. South Korea is not only home to the most active cryptocurrency exchange on the planet, but also is the third largest market for Bitcoin trading and responsible for 35 to 40% of global Ethereum trading and as it stands, China is still the world’s largest crypto market.

Due to this massive interest, Asian nations have led the way in regulating the market. In September 2017, cryptocurrencies took a major hit in value after China’s government under President Xi moved to ban ICO’s and shut down key cryptocurrency exchanges. South Korea has similarly prohibited domestic companies participating in ICO’s, and is allegedly mulling over ways to tax cryptocurrency transactions.

Despite the harsher tone, central banks across the region and the rest of the world have been considering developing their own digital currencies. In a CNBC article from November last year, Blockchain CEO Peter Smith predicted that we are “24 months from a major government issuing a sovereign digital currency.”

Related: Financial Conduct Authority Warns on Bitcoin

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Today’s Bitcoin slide

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ALL RIGHTS RESERVED © INVSTR LTD. 2018

Risk Disclosure:
Invstr is a technology platform, not a registered broker-dealer or investment adviser. Invstr does not offer its own recommendations of any security or provide its own research to any user regarding any security transaction or order.
Please note, investing involves risk and investments may lose value. Past performance does not guarantee future results.
Brokerage services are provided by the following:
US-traded securities, including fractional trading, are provided to Invstr users by DriveWealth LLC, a regulated member of FINRA/SIPC. DriveWealth may not establish investment accounts to residents of certain jurisdictions. For more information, including disclaimers, risk and transaction fees click here.
India account traded securities are provided by SIC Stocks & Services PVT Ltd. SIC does not make any personal recommendations to buy, sell or otherwise deal in investments. Investors make their own investment decisions. The services and securities provided by SIC may not be suitable for all customers and, if you have any doubts, you should seek advice from an independent financial adviser. For more information and disclaimers, click here.

 

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