22 Jan Bitcoin tanks more than 10% to below $11,000; South Korea announces details on crypto tax
Bitcoin and other major digital currencies dropped sharply Monday morning.
Bitcoin briefly tumbled to a low near $10,234 on Coinbase around 11 a.m., ET, marking a loss of about 11 percent over the last 24 hours. Bitcoin traded near $10,487 as of 11:56 a.m. on Coinbase, the leading U.S. marketplace for buying and selling major digital currencies.
Ethereum fell below the psychologically key $1,000 level again and traded about 6.5 percent lower near $980, according to CoinMarketCap.
Bitcoin in the last hour
Ripple, the third-largest digital currency by market capitalization, fell about 12 percent to $1.22, according to CoinMarketCap.
The price decline came as some details emerged on cryptocurrency regulation in South Korea, where the government has been trying to limit excessive speculation.
The South Korean government said Monday it will collect up to 24.2 percent of corporate and local income taxes from the country’s digital currency exchanges this year, according to an English-language report from the local Yonhap News Agency. In a potential move towards taxing cryptocurrency transactions, the news agency also said the government plans to require digital currency exchanges to share users’ transaction data with banks.
Bitcoin trading in South Korean won accounted for 4 percent of trading volume, according to CryptoCompare. The Japanese Yen had the largest share, accounting for about 37 percent, while the U.S. dollar had about 33 percent of bitcoin trading volume, the website showed.
Nearly all digital currencies plunged in the middle of last week following concerns over increased cryptocurrency regulation in South Korea and China. Bitcoin even fell below the $10,000 level that it first topped in late November.
Last Tuesday, Yonhap News reported that South Korean Finance Minister Kim Dong-yeon also said in a radio program interview that “the shutdown of virtual currency exchanges is still one of the options” the government has. The news followed an announcement in late December the South Korean government is banning new trading accounts, and requiring users to use their real names.
However, prices had stabilized by the end of last week.
Bitcoin in the last week
Fundstrat’s Tom Lee, a noted Wall Street strategist, raised his price target on bitcoin Thursday and now sees the digital currency hitting $25,000 by the end of this year. Lee also said that $9,000 is low for bitcoin and offers a buying opportunity.
Reuters reported Monday morning that new research from accounting giant Ernst & Young found that more than 10 percent of funds raised through “initial coin offerings” are lost or stolen in hacker attacks.