South Korea eases back on crypto regulation

South Korea eases back on crypto regulation

South Korea launched a real-name trading system for cryptocurrency transactions January 30 to prevent virtual coins from being used for money laundering and other crimes.

Cryptocurrency traders in South Korea can now rejoice because it pretty much sounds like the country doesn't really want to ban trading in digital assets entirely.

In a controversial announcement, Mr Jung admitted the government was considering a law to close all the nation's cryptocurrency exchanges.

On the Luxembourg-based Bitstamp, bitcoin rose as high as $11,700 BTC=BTSP and was last at $11,511.

"While the threat of heavy regulation, or even a total ban on exchange trading, has hovered over Bitcoin in recent weeks, reports this morning that the South Korean government are softening their stance have given traders confidence to buy", said Dennis de Jong, managing director, at online brokerage UFX.com in Limassol, Cyprus, according to Reuters.

Three local banks including Shinhan Bank, Industrial Bank of Korea, NH Bank, are now offering cryptocurrency accounts to around five local virtual coin exchanges.

The news has been well received by the cryptocurrency community with bitcoin surging nearly 4 percent in value earlier today.




Thus, bitcoin has managed to recover from its two-month low of $6,000 recorded earlier this month and is now trading at $11,186, according to CoinMarketCap.

"Bitcoin's price history suggests that months of consolidation are followed by weeks of rapid advancement", said Canaccord Genuity in its latest research note.

Bitcoin has been pressured this year by a slew of regulatory initiatives around the world, including the incidence of hacks on exchanges. Other major digital currencies have escalated as well.

Litecoin, the 5th largest cryptocurrency by market value, was 1 of the biggest gainers with a 9.3% rise at $246.03.

Mr Jung had been handed a new job leading the Seoul crack down on the cryptocurrency industry near the end of a year ago.

At a briefing last month, Jung said virtual currencies like bitcoin were not a form of legal currency and the government would "strongly respond to excessive cryptocurrency speculation and illegal activity", WSJ reported.

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