Prices for Bitcoin have been adversely affected after South Korea began another onslaught on cryptocurrency trading. South Korea shall restrict cryptocurrency trading and implement steps to control speculation.
To suppress cryptocurrency trading, South Korea is going to forbid the opening of unidentified cryptocurrency accounts, prevent banks from settling trades of bitcoin exchange between unrecognized parties and form new regulations to permit regulators to shut virtual coin exchanges if this is essential.
The steps have been suggested as a way to eliminate market speculation in a state which is thought to consist of a big part of global cryptocurrency trading. Bitcoin reduced by almost 8% on Thursday morning trading (on the day) at $14,191 (£10,552). It had made a small recovery from the day’s low of $13,672 (£10,168). A CoinDesk list indicated that this announcement scared investors. The Chicago Mercantile Exchange (CME) gave a list of Bitcoin futures. Their trading was low also and futures would expire in January with a reduction going to $400 (£297) at $14,690 (£10,924) whereas the ones expiring in March reduced to $610 (£453) at $14,330 (£10,655).
Also, South Korea is trying to decide whether to close the country’s bitcoin exchange or not. In a statement, the government of South Korea said, ‘The state had issued warnings numeral times that virtual coins cannot act as real currency and this may lead to massive losses because of too much instability.’ At the beginning of this month, already, Seoul had suggested taxes on transactions of cryptocurrency, restricting foreigners and underage investors from setting up trading accounts of exchanges for the cryptocurrency.
Additionally, South Korea is thinking of a cryptocurrency capital gains tax and has already prohibited using Initial Coin Offerings (ICOs) that permit investors to exchange cryptocurrencies such as Bitcoin for proprietary ‘tokens’ or ‘coins’ connected to a particular project or firm. China has prohibited ICOs also. After the US and Japan, South Korea ranks third among the most prominent market in the globe in bitcoin trading. The country has about two million investors who trade in virtual currency. It is equal to about one in every 25 inhabitants.
Trading costs of majority of cryptocurrencies are a lot higher on the exchange of South Korea, compared to other states. The cryptocurrency has hooked South Korea so much that a new expression has been created, ‘bitcoin zombie.’ It illustrates an individual who analyzes the cost of bitcoin 24/7 whenever they can. Lee Nak-yeon, the Prime Minister, cautioned that the cryptocurrency fame could cause ‘severe misrepresentation or social pathological trend’ and also steer the youth to unlawful acts such as dealing in drugs.
Some investors have handed in a petition also against controlling cryptocurrencies that presently have 17,000 signatures. It requires 200,000 to obtain a compulsory reaction from the state. The reduction of Bitcoin’s price comes after evident losses the previous month when the cryptocurrency reduced by 36% from almost $20,000 to about $12,137 in only five days. It was triggered by information that one of the cryptocurrency exchanges in South Korea was doing poorly after a cyber attack. Meanwhile, another US exchange called Coinbase indicated it would commence an investigation on high increases in price.
In spite of its consistent price issues, Bitcoin remains up on the year after beginning at about $900 in January. The start of bitcoin futures by CBOE and CME also at the beginning of this month after approval of US regulatory has been praised by proponents as assisting to legalize using the virtual currency. It is a conflict-ridden matter among investors, and Goldman Sachs is said to be getting ready to venture into the market only months following the description of Bitcoin as a ‘scam’ by Jamie Dimon, the JP Morgan boss. But, International Monetary Fund’s Christine Lagarde remarked, ‘it might not be advisable to disregard virtual currencies.’ Britain’s Treasury has declared plans for detailed examination cryptocurrency. It will be a section of the grand plans from EU which will need online platforms that trade in Bitcoin to perform due diligence on clients and report distrustful transactions.
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