Bitcoin Price Plunge: Regulatory Concerns Are Increasing
Bitcoin (BTC) continues to fluctuate. The rise and fall has been driven by regulatory concerns and analyst’s comments. A brief rally over the weekend sent bitcoin prices from below $10,000 to $13,000. However, this was short-lived; the bitcoin price collapsed again during Monday trade. Traders blamed regulatory concerns from South Korea, India, and the European Union for the latest plummet. Currently trading at just above $11,500, Bitcoin is down 11% from the previous close.
Several Indian banks have suspended cryptocurrency exchange accounts in order to control money laundering and the transfer of money from India to other destinations. The Indian finance minister, Arun Jaitley, has already denounced digital currencies and the government is now taking necessary actions to stop cryptocurrency trading.
In a bid to control the massive growth in cryptocurrency prices, the European Union has signaled strong initiatives to end the bitcoin bubble.
Valois Dombrovskis, vice president of the European Commission, has cited “clear risks for investors and consumers associated to price volatility”.
The European Union has appointed Central bank Deputy Governor Jean-Pierre Landau to suggest ways to regulate digital currencies. In a separate report, Nordea Bank, the largest Northern European financial services group, has banned their employees from cryptocurrency trading.
Although South Korea hasn’t yet announced a complete ban on cryptocurrency trading, they have implemented new taxes on cryptocurrencies. Several investors are pleased with the government’s decision of introducing taxes instead of banning the digital currencies.
According to reports, the country has imposed a 22% corporate tax and a 2.2% local income tax on cryptocurrency exchanges. They have recently banned anonymous cryptocurrency accounts and prohibited foreign traders to trade virtual currencies in South Korean exchanges. The country has also frozen the opening of new virtual accounts.
Despite mixed signals from the South Korean markets, investors are currently showing their concerns over India, which has completely suspended cryptocurrency trading accounts.
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