South Korea’s Ban To Anonymous Crypocurrency Trading Leads to Bitcoin’s Price Fall

One of the things that made cryptocurrency investments lucrative, and risky, was the fact that the entire industry is still largely unregulated everywhere in the world.

So far, three major cryptocurrency exchanges in South Korea have said they are in line with the new mandate.

Bitcoin had a slow start to today’s session, but the cryptocurrency’s performance has improved in more recent trading. Therefore, as S Korea bans cryptocurrency starting January 30, South Korea-based cryptocurrency traders are not allowed to make deposits into their virtual wallets given that the names of the respective bank accounts match the same in cryptocurrency exchange.

Meanwhile, South Korea’s financial watchdog also found out that some virtual currency exchanges were slack in their management of funds, including keeping customers’ money in the private accounts of their CEOs, after conducting site inspections into exchanges. Whether the regulations set by South Korea are good or bad, just the fact that one of Asia’s biggest markets is now controlled will likely cause a commotion before January 30. The state agency has once more shown the lack of unanimity in the local authorities to implement a ban on the cryptocurrency market.

“Nobody, including the government, guarantees the value of cryptocurrencies”. As an investment class, cryptocurrencies are speculative investments and investing in cryptocurrencies involves significant risks – they are highly volatile, vulnerable to hacking and capital loss and sensitive to secondary activity.

A man passes by a screen showing the prices of bitcoin at a virtual currency exchange office in Seoul, South Korea, on Tuesday.

Under the current laws affecting virtual currency, corporations with income over 20 billion won or $18.7 million are required to pay 22 percent and 2.2 percent of corporate and local income taxes on their income during 2016. In late 2017, the price discrepancies among 17 USA exchanges for one bitcoin amounted to $4,000, or about a 31% difference between the high and low prices.

Bitcoin was trading near the $10,400 mark on Tuesday following the news, as cryptocurrency investors are anxious that regulation will become tighter. South Korea has blocked the way for traders to illegally transferring money, through the latest tracking rules. In Tuesday afternoon trade, it was up 5.4 per cent at $10,925.

Other popular cryptocurrencies nearly invariably follow the same patterns of price movement. Both bitcoin and Ethereum have lost over 10% in a day.