24 Jan Cryptocurrency Traders Cheers South Korean Stance, But the Upside is Limited
Cryptocurrency markets weren’t as volatile as expected, following the final announcement related to South Korean regulatory actions. Markets declined initially in early hour trading after South Korea sidelined all the claims for completely banning the cryptocurrency trading. Instead, the country has announced to track the identity of each cryptocurrency trader for tax purposes, retreating from the initial claim of government ministers for banning the virtual currency trading.
After dipping close to the level of $10,000 mark, Bitcoin price moved back to $11,000 at the time of writing. The sideways movement in bitcoin price clearly indicates that investors have admired the South Korean strategy of swiftly regulating the virtual currency.
Previously, the government has placed 24.2 percent of corporate and local income tax on cryptocurrency trading. South Korea has blocked the way for traders to illegally transferring money, through the latest tracking rules.
Although the new regulations have provided a brief support to bitcoin traders, the trading volume and popularity of the virtual currency could likely to decline sharply. Cryptocurrency was popular among investors amid it potential to make anonymous transactions.
India has already suspended cryptocurrency trading accounts. They anticipate regulating digital currencies in a bid to collect taxes and curb the money laundering threats.
The next few months are significant for cryptocurrencies considering the increasing regulatory environment for digital currencies. At the upcoming G20 meeting in March, countries from all over the world are expected to enforce a new set of regulatory rules on cryptocurrency trading. IMF and the European Union are also working on the task of creating strict regulatory requirements.
Mr. Chiavarone said: “The currency itself isn’t a great medium of exchange; it’s not a great store of value. It has a fixed amount so the Fed would have to kill it at some point because they wouldn’t be able to engage in monetary policy.”
Cryptocurrencies continue trading sideways based on rumors related to regulatory requirements. However, several major analysts are suggesting investors avoid trading digital currencies in order to see the real impact of regulatory requirements.
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