Everyone who is trading Bitcoin in South Korea, will, from now on have to identify themselves. This is since new regulations have come into force, which endangers one of the cryptocurrencies most central principles.
This regulation threatens one of the core parts of Bitcoin, the fact that they can make anonymous transactions. The outcome is not as bad as it could have been though. Initially, senior government ministers wanted to ban the trading in Bitcoin. The virtual currency is incredibly popular in South Korea, so much so that citizens have to pay an extra markup in order to buy them. They have even contributed to get Bitcoin where it is today, so the recent suggestions of a ban, or tough regulations could cause the whole currency to crash. This recent regulation, has caused the price of Bitcoin to fall approximately ten percent.
The new regulations are set to take effect early next week, and will prevent those living outside of South Korea, and who do not have local bank accounts, and those who are 19 and under from buying or selling all cryptocurrencies. These rules are designed to crack down on speculative trading and possible crimes, such as engaging in money laundering and tax evasion.
The requirements will ensure that an investors crypto currency will come from a bank account thatâs owned by the same individual, and all banks will be able to refuse to open accounts with crypto currency exchanges that do not disclose all information about any suspicious trading. Kim Yong-Beom, the Financial Services Commission Vice Chair said;
âWe expect that crypto currency exchanges that are in danger of being exploited for money laundering will be thrown out of the marketâ
He is quick to add that the government does not intend to encourage or stimulate crypto trading.