Concerns about possible cryptocurrency trading ban in South Korea and China have triggered a massive sell-off in the digital currency space since Tuesday, pushing prices on a downward spiral. Siacoin traded at $0.043769 with a market cap of $1.37 billion, down by almost $400 million from $1.77 billion the day before.
“The January drop is a recurring theme in cryptocurrencies as people celebrating the Chinese New Year, aka Lunar New Year, exchange their crypto for fiat currency”, said Alexander Wallin, chief executive of trading social network SprinkleBit in NY.
But analysts have warned bitcoin needed solid buying support soon.
Of course, a buyer could be sitting in Singapore or Serbia while using South Korean won to trade, but the Coinhills breakdown is pretty much the best we have to go on.
An online petition on the presidential office’s website has drawn more than 210,000 requests from people asking the government not to ban trading in digital currencies.
News has developed in South Korea again, as the nation considers a closure of cryptocurrency exchanges. New payment legislation that took effect in April requires exchange operators to register with the Financial Services Agency and meet certain standards, such as holding a minimum of 10 million yen ($88,000) in capital and managing client funds separately from virtual currencies.
“The proposed shutdown of exchanges that the justice minister recently mentioned is one of the measures suggested by the justice ministry to curb speculation”, the Office for Government Policy Coordination announced on Monday. Lesser known digital currencies were down even more.
South Korea has yet to make clear their stance on cryptocurrency trading. In fact, numerous major alternative cryptocurrencies, or altcoins, are faring much worse. “People are selling to try and get the hell out of there”. Reports quoting the survey said a 25-year-old, who had invested Rs 25 lakh in bitcoins, has seen the valuations of the currency he held multiplying to Rs 760 crore.
The minimum number of signatories required for a government response is 200,000, meaning that the South Korean government has a commitment to answer the petition within 30 days.