Bitcoin price became volatile this morning as news from South Korea implied trading of all cryptocurrencies would be banned outright. The reality of the situation soon became clear: regulators in South Korea were only saying they were “considering” a ban in an effort to “cool down” the current cryptocurrency trading boom going on in the country (and indeed worldwide.) In reality, as you might already well know, there’s no real way to “ban” the trade of Bitcoin, save the outright banning of all human beings from access to the free and open internet.
It’s easy to see how the statement that caused this mess was misconstrued. According to Rueters, who in turn source the Justice Ministry’s Press Office, Justice minister Park Sang-ki suggested the following: “There are great concerns regarding virtual currencies and the justice ministry is basically preparing a bill to ban cryptocurrency trading through exchanges.”
After the first dip as an immediate reaction to the announcement, another statement was made by the SK Presidential office which suggested nothing was final. The same secondary statement suggested that no trading ban would be inflicted in the short term.
In November of 2017, South Korean Financial Services Commission Chairman Choi Jong-ku said something similar. “The government is examining how much to regulate virtual currency trading,” said Jonh-ku. “A total ban is among the options on the table.”
Earlier chats about this situation – also back in November of 2017 – had Kim Jin-hwa, co-representative of a committee working to establish the Korean Blockchain Association speaking up. “If we ban virtual currency exchanges altogether as the Financial Services Commission recommends, we are likely to end up in a situation where nobody takes the responsibility.” said Jin-hwa via Khan.
“We need to restrict people from targeting an unspecified number of the public and recommending them to invest in virtual currency claiming it is a safe investment that can bring them a huge amount of money” said Professor Jung Sun-seop, Seoul National University Law School. “It needs to be clearly explained that virtual currency is different from cash, which is the legal currency that the government guarantees.”
Clearly the South Korea government needs to get their act together and figure out what they’re going to do about cryptocurrencies before they make any more grand statements. It’s almost as if they don’t understand the nature of the situation.