Following the news that South Korea Plans Cryptocurrency Trading Ban, Bitcoin’s value has tumbled to $14,000.70. Will the government eventually implement the ban?
11 January, AtoZForex – The Justice Minister of South Korea has shared government plans in regards to the cryptocurrency trading in the country. It appears that South Korea prepares to ban all the digital currency trading in the country.
South Korea Plans Cryptocurrency Trading Ban
The news emerged as a major twist for the crypto space, since South Korea accounts for the majority of cryptocurrency transactions on the market. In fact, more than 10 percent of Ethereum is traded against South Korean Won, the same goes for the 5% of all Bitcoin trades. Park Sang-ki has stated:
“There are great concerns regarding virtual currencies and justice ministry is basically preparing a bill to ban cryptocurrency trading through exchanges.”
Following the comments from Park, Bitcoin value has dropped more than 12 percent. As of the moment of publishing 1 BTC is trading at $14,000.70.
Mr. Park has added that he cannot disclose more details about the proposed ban on cryptocurrency exchanges in the country. However, he has mentioned that several government agencies will join their forces to implement these measures.
How soon will South Korea Cryptocurrency trading ban be valid?
Furthermore, some online reports stated that a press official stated that the proposed ban on cryptocurrency trading has been announced following the discussion with some government agencies. These included South Korean finance ministry and financial regulators.
Moreover, reportedly, once a bill is drafted, the law for an outright ban on cryptocurrency trading will need a majority vote of the total 297 members of the National Assembly. This process could be lengthy – months, or even years.
Digital currency trading in South Korea is very similar to gambling. In fact, the top cryptocurrencies are priced significantly higher than elsewhere in the world. Many traders call this discrepancy in price a “kimchi premium”.
Last month, the South Korean government has informed the public that it might shut down some of the cryptocurrency exchanges. The authorities explain their decision by referring to the “irrationally overheated” trading.
The online reports quoted the South Korean government as saying:
“Cryptocurrency speculation has been irrationally overheated in Korea. The government can’t leave the abnormal situation of speculation any longer.”
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