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Following China’s decision to ban Initial Coin Offerings (ICOs), South Korea is now considering imposing regulation and monitoring of cryptocurrencies.
Bitcoin fell sharply this week as China announced its decision to crack down on Initial Coin Offerings (ICOs), seeing a plunge throughout the cryptocurrency market. Now, in the wake of that move, South Korea is considering imposing harsher regulation and monitoring of virtual currencies.
The People’s Bank of China revealed this week that, after concluding an investigation into ICOs, it would move to prohibit the use of digital tokens as currency and forbid banks from offering services in that regard. Chinese authorities have seen ICOs as a threat to the country’s financial stability given their reach beyond a conventional banking system.
Read: Is Bitcoin the future of currency, or just a commodity bubble?
The decision saw Bitcoin tumble by as much as 11% – its most sizeable decline since July this year.
Now, a meeting attended by the Korea Fair Trade Commission and the National Tax Service (among others) has been convened with the view of enhancing authentication procedures at exchanges while systems that enable the reporting of suspicious transactions may be implemented.
Though no official word has been given as yet, the meeting reportedly has discussed the potential of a ban on ICO fundraising platforms thanks to violations of the Capital Market Act. A Financial Services Commission spokesperson offered that authorities may strengthen levels of punishment for fund-raising businesses operating without permission.
The US Securities and Exchange Commission has further indicated that it will consider enhanced scrutiny over the sector should ICOs be considered securities – though no broader ban has yet been suggested. South African government has further begun to trial cryptocurrency regulation in a sandbox setting.
Though recent bans and further crackdowns might worry investors, cryptocurrencies may proceed to rally should Chinese authorities elect to allow token sales on approved platforms – a decision that may see approving bodies vet projects on an individual basis.
Should such measures take place, Bitcoin itself may break past the $5,000 USD mark; Max Kieser of RT’s Kieser Report posits that Bitcoin may yet surpass the $10,000 USD mark thanks to the level of activity on its network.
Read: Ethereum briefly eclipses Bitcoin in Google Search as rapid growth continues
What are your thoughts? Can Bitcoin surpass the $5,000 USD mark as regulation looms? Be sure to share your thoughts in the comments below!
Follow Bryan Smith on Twitter: @bryansmithSA