It has barely been two weeks since the mid-January 2018 crash of Bitcoin market, and now similar incident has happened once again, thanks to South Korean government and Facebook. Why? Well, for the same reason that was responsible for first major bloodbath of crypto markets – regulatory policies! The bad regulatory news came from South Korea, and all hell broke lose.
The new South Korean cryptocurrency regulation rules went into effect from yesterday, and soon after that Bitcoin dropped below $10,000. The rules state that everyone who indulges in cryptocurrency trading needs to provide his/her real identity. People need to link their real bank accounts with their Bitcoin wallets, and foreign investors are totally prohibited from accessing South Korean crypto markets. All of this has been done to ensure that Bitcoin isn’t used for money laundering and other criminal activities.
However, besides South Korea crypto market also got a shock from an unlikely place: Facebook. The social network announced that it won’t allow advertising related to cryptocurrencies and binary option on its website because such ads often pull users into some kind of trap and harm them. But it’s also very unlikely that this news might’ve had an impact on crypto markets as big as that of regulatory news from South Korea. At the same time, it’s still reflective of the fact that governments and organizations around the world are finally coming after Bitcoin.
At the time of writing this article Bitcoin is trading at $10,200. All major coins are down, as you can see in the chart shown below. Some less known coins may also be having their worst day today (and that’s why Cryptocurrencies are risky territory).
The Good News
At the same time all news was also not bad news. The South Korean Finance Minister has made it clear that the country doesn’t plan to impose a complete ban on trading of cryptocurrencies. Markets may take some time to recover from the shock that they got yesterday, but in the long run this is a good news that South Korea won’t ban crypto trading.
It has also been heard that Samsung is going to expand its chipmaking business into area of making chips that are particularly great at Bitcoin mining (ASICs). TSMC has also received some big orders for ASICs in the meantime. So in short, cryptocurrency trading and mining is here to stay.
There’s some good news and some bad news. In coming days there may again be some good and some bad news. Therefore, it’s very difficult to predict where crypto markets are headed. So be careful in your trading activities. Happy trading!