Bitcoin Suffers Major Drop Amid Concerns in China and South Korea

Bitcoin Suffers Major Drop Amid Concerns in China and South Korea. The bitcoin has fallen to its lowest value in the last six months following recent worries amid what authorities in South Korea and China could be doing with this and other cryptocurrencies in mind.

The bitcoin fell below the $12,000 mark on Tuesday. The currency was closer to $14,000 a day earlier.

The drop marks the lowest that the bitcoin has been at since the start of December. This is also close to half the peak value of the currency. It reached close to the $20,000 mark during the middle part of December.

South Korean Issues

South Korea has long been one of the top countries for bitcoin mining and trading. But Finance Minister Kim dong-yeon stated in a radio interview that the national government has the option to close down cryptocurrency exchanges.

This follows a week of worry where the South Korean government had thought about a bill to outlaw cryptocurrency trading. The government had announced it would tone down this concern and would only make a decision if enough options are reviewed over how to take care of the growth of such currencies.

Any impact on South Korea’s involvement with the bitcoin could hurt its value. About 4 percent of all bitcoin trading in the world comes from the country. This is according to information from CryptoCompare.

Additional Problems In China

There are also worries about what might come about in China regarding how the currency will be handled. Chinese authorities are aiming to block access to centralized cryptocurrency trading services. Groups that establish operations with the intention of profiting off of the bitcoin could also be targeted. This may be due to concerns over how such currencies are difficult for the government to run.

One central bank official in China even suggested that the country should ban all digital currency trading actions. The People’s Bank of China is aiming to add more pressure onto trading parties, but it has not gone as far as to suggest that all cryptocurrency trading actions should be suspended or outlawed.

Volume Changes May Be a Factor

An analysis of bitcoin trading does reveal that there is one concern surrounding volume that might be a factor for why the bitcoin’s value is changing. South Korea and Japan have been among the top traders of the bitcoin in recent time. But their combined trade values have gone below the 30 percent total recently. This comes as the two countries often pay premiums of 20 percent or more of their coin transactions. The rising values of these coins are causing some investors to get out of the market and to wait for the value to decline by a bit before getting in again.

Other Currencies Hit

The bitcoin is not the only currency being hurt by recent actions in South Korea and China. Ethereum, Ripple, Bitcoin Cash, Cardano and NEM have all experienced 24-hour declines of 20 percent or greater as a result of recent actions in those two countries. Smaller currencies have experienced even larger declines with SmartCash declining by nearly 50 percent in its value.

Advertisement

Click To Join Our Community Telegram Group