Market report

KOREAN FUD HITS US AGAIN

London Block Exchange

11th January 2017

Fear, uncertainty and doubt can cause panic — but we are here to help!

KOREAN FUD HITS US AGAIN

Fear, uncertainty and doubt can cause panic — but we are here to help!

Did you wake up with your cryptoassets tracking app alarm telling you the market had more sellers than buyers and the value of your investments had gone down? We did! But having heard similar alarms more times than we wish, we knew how to react.

Research is the key to knowledge and insight for what’s really happening behind what traditional media outlets report. At the London Block Exchange we want to help you capitalise on your curiosity and for you to stay ahead in this turbulent market.

So, what’s happening? During the night, two things took place in South Korea that created a 10% drop of the crypto world. The first was that two Korean exchanges confirmed they were raided by National Tax Service officials this week.

This is nothing new, as the exchanges reported that they have been under investigation since last year. After yesterday’s announcement that the Korean government wants to benefit from cryptoasset taxation, such operations are predictable.

More importantly, however, at around 2 AM GMT, the Justice Minister held a press conference that made the price of bitcoin on major Korean exchanges drop between 16% and 21% — although it’s still trading at a 25% to 30% premium compared to the rest of the world!

SO WHAT’S ACTUALLY HAPPENING IN KOREA?

It might not be as bad as it sounds!

In brief, the Ministry of Justice of Korea is preparing a bill that aims to ban all cryptoasset trading in the country. This is a larger step than the announcement by the Finance Ministry last December on regulating non-compliant exchanges.

The chief of the financial regulator of Korea had already said last month that some Justice Ministry officials were calling for an “outright ban on cryptocurrency trading” and there were rumours of different stances inside the Korean government.

If the bill is actually proposed it still has to go through South Korea’s National Assembly. Such a process is estimated to last months or even years, as it needs a majority vote of the total 297 members of the assembly.

Even if it goes through sometime in the future, this will likely make cryptoassets scarcer in Korea, driving up demand. Furthermore, Korea has elections this April and any party going against one of the most popular trends of the country could face trouble!

We all know what happened after last September’s China crypto ban — 15 days after the dip we saw the greatest bull run of the year. Korea has more to gain from taxing cryptoassets, as opposed to banning their trading, and the word of a minister is not the will of a government.

WHAT TO LOOK OUT FOR TODAY

To prepare for tomorrow!

Bitcoin Cash was one of the six top cryptoassets that didn’t lose value yesterday. Why? Their first fork is coming on Saturday and investors like aidrops!

As we write this, Kraken, a major exchange, is undergoing its supposed final system upgrade to overcome the issues it has been facing. Follow its progress here!

DMM, a large Japanese media group, is launching its crypto exchange today, which will support seven cryptocurrencies — including Ripple and NEM!

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Do you feel Warren Buffett is both right and wrong with his latest bearish remarks about the state of crypto markets? You are not alone!

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