New Cryptocurrency Regulations to Benefit the South Korean People (Q1 2018)
Originally published on: BTCMANAGER
Read the original article
January 31, 2018
January started with FUD (“fear, uncertainty, doubt”) coming out of South Korea regarding how legislation was being prepared to ban cryptocurrencies entirely. However, by the month-end, the government enacted previously established regulations supporting cryptocurrencies, not banning them.
New Regulations Impact South Korea (Good News!)
South Korea’s Financial Service Commission confirmed that the new measure outlined by the body previously this month had successfully been implemented as of January 30, 2018. The regulations state that it would only allow the trade of cryptocurrencies from bank accounts with verified names. By ensuring the accounts being used to trade had real identities South Korea could ensure banks and exchanges complied with their Know Your Customer Anti-Money Laundering (KYC AML) obligations.
These types of regulations should be expected and supported by the cryptocurrency community. If as a community we expect mass adoption, people need to be using their real names when investing, as if it were a stock on the NYSE (New York Stock Exchange). The regulations from South Korea add a layer of legitimacy to an industry riddled with scams, lack of regulation, and manipulation.
These legal provisions should not be considered in a negative light as it allows cryptocurrency trading to commence by the time you are reading this article, in South Korea. The South Koreans per capita trade significantly more than Americans and are regularly competing for the number one spot worldwide. Having their markets and banks back online will allow for a flow of funds back into the crypto space, in a regulated manner.
The volume numbers from South Korea currently are underinflated as their markets have been frozen for the majority of the last month. Currently, bitcoin trade denominated in the Korean Won was approximately four percent, Japanese Yen 40 percent, and United States Dollar 30 percent. South Korea, as of December 28, was the largest bitcoin market by volume making up over 20 percent of the total market. However, since then they banned new crypto trading accounts and began their month-long crackdown, they’ve dropped to four percent of the total bitcoin volume on a daily basis. This major FUD attack took place right before the New Year when the market correction in alts began to occur. The biggest fear was a complete ban on crypto. This never occurred, and the current regulatory stance should solely provide safety for those acting to invest in a legal manner.
These new regulations will not remove fiat from the crypto system but will allow new traders to open new accounts, old traders to resume trading, and the exchanges that were taken offline a month ago, to begin transacting under more stringent safeguards. South Korea and Japan seem to be adopting crypto through the process of regulating it versus trying to ban it outright. The King believes this will be the standard the majority of other countries follow. If crypto were a “fad,” it would have disappeared five years ago. Bitcoin came into existence at the end of 2008, and here we are ten years later with blockchain technology about to be the future of the business landscape.
It wouldn’t be wise for governments to combat this tech, but instead they should regulate it, and release their own cryptocurrencies pegged to their actual fiat currency. The crypto world is concerned about Tether (to be discussed in another article) and having government regulated currencies would be counter-intuitive to the crypto movement (decentralization), but they would add a level of legitimacy that does not exist among the scams and regular FUD attacks.
Top Coin to Benefit: ICON
The “Korean Ethereum,” ICON (“ICX”), is due to host their first blockchain event in the capital of South Korea in the tallest building in the country on January 31. The cleverly named: 2018 ICON ANNUAL SUMMIT: THE GENESIS will be hosted in the Lotte World Tower. Even if this was solely a publicity stunt, it is coming at the perfect time.
The King personally believes this is exponentially more than a publicity stunt. ICX missed their original mainnet deadline by three weeks. Their mainnet was successfully released a week ago allowing Dev teams the appropriate amount of time to fine tune any issues.
Now we approach The Genesis Summit. With new traders being able to open up accounts again, old traders finally being able to access their locked accounts, and a blockchain conference in the tallest building in the capital of the country, this should be an exhilarating few days for ICX. The “Korean Ethereum” should benefit most in the short term with the publicity their conference provides just as investors can enter the South Korean market again.
Conclusion: The Investor’s Perfect Storm for a Bull Market
The beginning of January was marked with multiple green days followed by a massive correction in 99 percent of altcoins. Going into January it was evident the money on futures was betting the price would decrease of bitcoin. This month the money flip-flopped, it actually expected the price of bitcoin to rise in February. February has typically been a bull market for the crypto space and regular financial markets.
Currently, we have struggled through multiple red days; these remind the King of the green days we had in early January. Except the green days were followed by a market collapse (“correction”); the same pattern seems to be repeating itself in the opposite manner. Instead of green days followed by a huge correction caused by the future contract holders. The King expects a few red days (what we’ve experienced the last 72 hours) followed by a rebound (instead of a correction) of enormous proportions.
South Korean exchanges and traders coming back online is one of many catalysts that will build steam for the upcoming bull rally. However, the influence and manipulation of whales and option traders betting on bitcoin’s rise this month is also a very positive catalyst (as we saw last month what happened when they bet bitcoin would depreciate, they crashed the market both days of option expiration). This month instead of having pressure holding the market down, we should feel pressure boosting it up. Countries choosing to regulate instead of a ban, major conferences across the globe, and general enthusiasm for blockchain technology as a whole will yield a solid Q1 for most crypto investors.
Coins with a significant focus on South Korea, like ICX, will be most likely to benefit in the immediate short term. South Korea’s newest regulations should be looked at as a positive because the alternative was an outright ban. Hopefully, the remainder of countries considering their stance follow a similar path to South Korea. Blockchain has solidified its place in business and the technology sector, and the faster countries and businesses move to adopt it the more successful they will be in its implementation.