By
Steve Muchoki
April 23rd, 2024
South Korea considers new approach to cryptocurrency regulation contributing to the new rise of Bitcoin.
The price of Bitcoin is still far from the level of December 2017, but the dominant cryptocurrency seems to recover from the recent fall in the beginning of February. Bitcoin crossed the $9,000 mark – it managed to get as high as $9,346 at 19.20 UTC according to CoinMarketCap. The reason of this rise comes from Asia.
South Korea has had significant influence on the crypto market during the last months. The country drew lots of attention with a number of governmental decisions on cryptocurrencies in January 2018. The new round of the possible changes in regulations brought promising news. South Korea is considering the adoption of Bitcoin Licenses, or simply BitLicenses for short. The national exchanges may soon start working in accordance with the New York State Department of Financial Services’ model.
BitLicense was developed in July 2014, but came into effect more than a year later – in August 2015. That is a business license that regulates cryptocurrency activities of both companies and individuals. This system is characterized by strict control and high requirements. In reality, the requirements of the New York State Department of Financial Services are so strict that it has approved only five companies for virtual currency licenses or charters.
On the 12th of February Business Korea quoted an official from the government ministry participating in a virtual currency task force who said: “We are positively considering the adoption of an exchange approval system as the additional regulation on cryptocurrencies. We are most likely benchmark the model of the State of New York that gives a selective permission.”
The BitLicense system can provide the South Korea government with a chance of regulating the crypto market in an orderly manner. Even though this decision may seem to be intimidating for the future of cryptocurrencies South Korea is still pursuing a policy of legalizing Bitcoin and its ilk. While China decided go with a complete ban, this country is making firm steps towards official integration of cryptocurrencies into its political and economical life.
The situation in Asia has seriously influenced the positions of Bitcoin. Nevertheless, some analysts believe that the positive trend of Bitcoin price has a more cultural connection to this region. They believe that the rise in price can be explained by the New Year holidays coming up. And contradicting this statement may turn out to be hard.
While Bitcoin traditionally takes the opening lines, it is not the only cryptocurrency which has demonstrated growth this day. Litecoin gained over 30% in price during the last 24 hours. Probably, one can find lots of explanations of this fact on the internet but the most plausible one is the imminent launch of its faster version – Litecoin Cash. The whole story seems to be an act of unprecedented generosity: one original Litecoin may be exchanged for 10 Litecoin Cash tokens. However, the experts warn against massive investments in the new cryptocurrency: Litecoin Cash may turn out to be scam.
Even though the dominant cryptocurrencies seem to be on the rise, the critical voices cannot be silenced. This Tuesday Peter Boockvar, chief investment officer of Bleakley Financial Group, said: “This is the everything bubble generated by seven years of zero interest rates and negative interest rates overseas and massive amounts of money printing. It shows up in the asset price inflation in many different places”. One more expert expects the bubble burst while only 4 out of top 50 cryptocurrencies showed decline during the last 24 hours.