In one of the bigger back-and-forth stories in digital currency, South Korea has announced that it is definitely for real this time sure that it does not plan to ban crypto-currency exchanges.
That news comes care of the government’s finance minister and came as welcome news for crypto investors nationwide.
Finance Minister Kim Dong-yeon’s comments may put to rest worries sparked worldwide over South Korea’s stance on digital currency — after government officials in various departments began sounding off about a potential ban. South Korea is one of the world’s major hubs for crypto trading — and a local ban was considered a stumbling block for an exploding market. It has also been a weight on the price of bitcoin, which has seen its prices struggle in early 2018 after explosive growth capping off 2017.
“There is no intention to ban or suppress the cryptocurrency (markets),” Kim said, adding the government’s immediate task is to regulate exchanges.
The announcement follows increased regulatory action — customs officers in South Korea announced on the same day that they had uncovered around $600 million in illegal cryptocurrency foreign exchange trading.
“Customs service has been closely looking at illegal foreign exchange trading using cryptocurrency as part of the government’s task force,” it said.
Illegal foreign currency trading of 472.3 billion was the main line of the cryptocurrency crimes, according to customs services. As of now, it is not known what, if any, actions will be taken against the perpetrators. In South Korea, only licensed banks and brokers can offer foreign exchange services. Firms and individual who attempt to send $3,000 out of the country at a time must submit documents to tax authorities explaining reasons for the transfers. Annual overseas transfers of more than $50,000 must also be reported.
Increased regulation in the digital currency market has also gone into effect in South Korea, which going forward will only allow real-name bank accounts to be used for cryptocurrency trading. The theory is that this will dampen bitcoin money laundering efforts.
Heightened regulatory scrutiny, combined with uncertainty on a number of fronts, has taken a toll on the price of bitcoin — which stood at just over $10,000 per coin as of the writing of this story (Jan. 31). That price represents a fall-off of about 27 percent this month, marking the digital asset’s largest monthly decline since January 2015.
Regulation hasn’t been the only issue rocking prices, however. Cryptocurrencies have also taken a hit on security concerns — last week, Tokyo-based Coincheck saw hackers make off with $500 million in one of the world’s biggest cyber heists.