[Bitcoin Now] Plummets to 37 Million Won Range... Cryptocurrency Faces Regulatory Challenges

Price Dropped to 36.8 Million KRW That Day
People's Bank of China Pressures Major Banks and Payment Institutions... Cryptocurrency Speculation Issues
Financial Services Commission Considers Singapore Model... Only Bitcoin and Ethereum Traded in Singapore

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Gong Byung-sun] The leading cryptocurrency Bitcoin has sharply dropped to the 37 million KRW range. This decline is interpreted as a result of the cryptocurrency market facing regulations, with China cracking down on its citizens' Bitcoin trading activities and South Korea considering a licensing system for cryptocurrencies.

According to the domestic cryptocurrency exchange Upbit, as of 8:15 AM on the 22nd, Bitcoin recorded 37.33 million KRW, down 10.78% compared to the previous day. This is the first time Bitcoin has been in the 37 million KRW range since the 9th. At 7:59 AM on the same day, it even fell to 36.8 million KRW.

Altcoins showed even larger declines. At the same time, Dogecoin fell 35.05% compared to the previous day, recording 215 KRW. Although not designated as a watchlist item, altcoins such as Bora, Moscoin, DicarGo, Humanscape, and Metadium also showed a 30% drop. According to Upbit, there was not a single cryptocurrency that rose in price.

It appears that regulations originating from China have negatively impacted the cryptocurrency market. On the 21st, the People's Bank of China announced on its website that it had conducted a "Weitan" targeting some banks and payment institutions regarding cryptocurrency speculation issues. Weitan is a uniquely Chinese coercive culture where government agencies summon personnel from supervised institutions to reprimand and pressure them. Attendees of this Weitan included representatives from major Chinese banks such as Industrial and Commercial Bank of China and Agricultural Bank of China, as well as corporate representatives from Zhifubao (Alipay) operated by Alibaba Group.

After the Weitan, the People's Bank of China stated, "Cryptocurrency trading and speculation disrupt normal financial order and encourage criminal activities such as illegal overseas asset transfers and money laundering," adding, "This seriously infringes on the property safety of the people." Furthermore, the People's Bank of China announced plans to complete a transaction monitoring model to track funds related to cryptocurrency exchanges, which are deemed illegal in China.

The domestic cryptocurrency market is also facing regulations. According to financial authorities on the 22nd, the Financial Services Commission is considering introducing a licensing system that would leave only two to three exchanges operating. This approach is similar to Singapore's system. In Singapore, exchanges must obtain a total of seven licenses, including account issuance, domestic remittance, overseas remittance, and product purchase, to operate legally. Currently, only Bitcoin and Ethereum are available for trading in Singapore.