Bitcoin Price Crashes On Fear Of South Korea Cryptocurrency Ban

Bitcoin Price Crashes On Fear Of South Korea Cryptocurrency Ban

Bitcoin slumped as the South Korean Ministry of Justice reiterated a proposed ban on cryptocurrency venues, fueling concern that a government crackdown would erode one of the world's biggest sources of demand for digital currencies.

Bitcoin dropped sharply on the Bitstamp exchange, after South Korea's justice minister said a bill was being prepared to ban cryptocurrency trading. Then South Korea's justice minister announced on Thursday (late Wednesday in the U.S.) that they are preparing a bill to ban cryptocurrency trading.

After the bill is drafted, legislation for a complete ban of virtual coin trading would require a majority vote of the total 297 members of the National Assembly.

Cryptocurrencies are very popular in Korea, and prices are often significantly higher there than in other markets - to the point that cryptocurrency market cap tracker CoinMarketCap recently excluded Korean exchange prices from the price averages of popular coins.

Q: Other countries like the United States and Japan are not closing exchanges.

Following the market's reaction to the government announcement, the nation's Presidential office later said that a ban on the country's virtual coin exchanges was not finalized, although it was being discussed.

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Looking back just weeks, today's quotes also fly in the face of previous comments from the government's financial regulators, which had said that it plans to prevent minors, foreigners and institutions from owning and trading cryptocurrency.

Cryptocurrency markets at home and overseas responded quickly and radically Thursday on signals by South Korea's Ministry of Justice that it would seek to shut down all exchanges for digital assets.

Cryptocurrency prices plunged in response to the news as South Korea, along with China, has become one of the centres of the cryptocurrency boom. South Korea's cryptocurrency-related shares were also hammered. "Some officials are pushing for stronger and stronger regulations because they only see more (investors) jumping in, not out". In recent times, Ripple and Ethereum owe their price increases to a surge in trading at Bithumb. The employee said that the exchange was cooperating with the investigation. In its statement from December, the government hinted at the idea of an outright ban of cryptocurrency exchanges.

According to industry website CryptoCompare, more than 10 percent of ethereum is traded against the South Korean won - the second largest concentration in terms of fiat currencies behind the dollar.

Police have been investigating Coinone's margin-trading service since past year, according to an official who asked not to be named citing policy.

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