As it became known, in South Korea, the financial authorities are to impose fines for those cryptocurrency traders who refuse to convert their virtual accounts into real-name ones.
Recently, taking into account the growing interest of South Korean employees in putting their money in virtual currency the country’s financial authorities have been actively working on development of new regulations.
At the moment, anonymous cryptocurrency trading via virtual accounts can be carried out. Nevertheless, on or around January 20 new measures regulating this issue will be implemented and only real-name accounts will be allowed. So, investors have an opportunity to make changes in respect to their existing anonymous accounts within this month, otherwise they will be fined. It will be possible to use their virtual accounts only for withdrawing funds.
The amount of fines for these violations still remains unclear. But it is expected that the fines will be similar to those imposed to violators of the country’s real-name financial transaction system. In 1993, those fines amounted to 60 percent of violators’ financial assets.
One of the latest moves to prevent speculations with cryptocurrencies was an introduction of a ban for banks to offer virtual accounts aimed at selling or buying cryptocurrencies to individual customers.
Until banks install a verification system ensuring only real-name bank accounts and matching accounts at cryptocurrency exchanges to be used for deposits and withdrawals, opening anonymous cryptocurrency accounts is also banned. If the bank refuses to introduce this real-name verification service, it won’t be allowed to register accounts for transactions with virtual currencies even if they are opened under real names.
In these terms of uncertainty, more and more financial companies and government agencies are warning their employees to refrain from trading in cryptocurrencies, some of them have prohibited their staffers to trade in virtual currencies during business hours or asked them to abstain from this activity during off-duty hours. Among these institutions are the Korea Exchange, the national stock market operator, and agencies such as the Fair Trade Commission, the Financial Supervisory Service, the Bank of Korea and others.
Even though in South Korea virtual currency investors are not legally protected and cryptocurrency transactions are not regulated being not recognized as financial products, the news about possible ban on cryptocurrency trading exchanges immediately created a panic at the market.
Nevertheless, later it was released that the decision on this issue has not been finalized yet. The major currencies affected by this news were Bitcoin and Ethereum. Bitcoin plunged by more than 12% to a low of $13105.90, while Ethereum that has been growing dramatically since the beginning of the year plunged to a low of $1149.50. The situation has already improved by this moment. According to CoinMarketCap, Bitcoin is trading at $14 375,20, and Ethereum – at $1 314,61.