The cryptocurrency industry was able to reach $300 billion at one point in 2017. Bitcoin was selling at around $20,000 in South Korea with Kimchi Price on its exchanges. However, things looked different as 2018 entered. It was inevitable that regulatory changes are going to be applied on the crypto industry.
Considering the risk investors are taking from hacks to encountering scams in the crypto industry, regulators are forced to do something. However, if there is a silver lining to all this, despite Bitcoin losing 70{4ede17fdd9b4ce8121d01fc4b54913fe84f8215aace504cc657695cefb5329ff} of its all-time high’s value at one point, there are more countries that are more open to the crypto industry.
South Korea mentioned that they are ready to implement G20’s unified cryptocurrency rules. So far, South Korea Blockchain Association has approved 12 cryptocurrency exchanges in the past week. It includes the likes of Bithumb, OKCoin Korea, Korbit, Coineone, Gopax, Huobi Korea, CoinZest, CPDAXX, HanbitKor, Neoframe, and DexKor. South Korea Blockchain Association is the institution that oversees the overall development in the crypto industry in the country.
This move is expected to bring in a new wave of capital in the market. This was after crypto exchanges were paused by the government until it legitimized the cryptocurrency market and regulate trading platforms.
Controversial Decision to Add Bithumb
It is a controversial decision to approve Bithumb. In June, Bithumb was a victim to hackers which around $40 million was lost. $16 million was recovered though by the company. However, local investors aren’t happy as they have lost their trust in Bithumb. For years, Bithumb was the leading cryptocurrency exchange in the country.
Even after a month since the incident, there are no signs of opening deposits and withdrawals even in the near future.
During a press conference in June, Kim Yong-bum who is the financial Services Commission (FSC) chairman said that “the government’s practical policies led the ‘Kimchi Premium’ to disappear in South Korea. At its peak, the ‘Kimchi Premium’ in the local cryptocurrency exchange market reached 50 percent, due to unusual spike in demand and speculation. As of current, the price cryptocurrencies is nearly identical to other markets, demonstrating stability in the South Korean cryptocurrency market”.
However, aside from the approval of Bithumb together with the other exchanges, this update made by South Korean regulators has been received in a positive manner. This could also be a sign of future action by the South Korean government that can lead to tight regulations within the crypto market in order to ensure the growth of the industry.
South Korea isn’t the only country that is doing its best in order to tighten up regulatory policies. Japan is also doing its best in order to protect its investors.
Japan has been one of the countries that implemented strict rules and regulations when it comes to cryptocurrency exchanges looking to operate in the country. In fact, this prompted Kraken to even transfer to another country.
Regulatory clarity is a must in order to attract not only the average investors but even institutional investors in the future. And this kind of strategy is needed by the market.
