South Korea Back in the Crypto Game?
South Korea (SK) has historically been a big player in crypto markets, estimated as the "third-biggest market in the world for Bitcoin trades, behind Japan and the US", according to this article.
However, SK's government has placed a lot of regulatory pressure on its crypto-crazed citizens in recent months, starting in late January this year (2018) with the requirement that trade of cryptocurrencies on SK exchanges be limited to real-name bank accounts. Many rumors of an outright SK ban of crypto trading started spreading over the internet as early as December of 2017 and lingered on until January 30 of the next year, when its Finance Minister, Kim Dong-yeon, made an official statement that no such action would be taken. Whether his words were enough to completely quell the fear of trading or holding cryptos in SK exchanges is still doubtful.
Fast forward a little less than 5 months to June 20, 2018:
$32 million in crypto assets were reportedly hacked on the world's 7th largest crypto exchange (by volume) at the time, Bithumb. This, only a week after another SK exchange, Coincheck, reported an undisclosed amount of bitcoin having been stolen by hackers. Bithumb disabled all deposits and withdrawals in response to the hack and this "freeze" of money transfers lasted roughly a month.
But that's not all...
Still in effect from that event, Bithumb's banking partner, Nonghyup Bank, froze withdrawals to the crypto exchange and Bithumb closed all attempts at registration to their platform...
...that is, until yesterday (August 29, 2018).
Yes, Bithumb is now accepting new users, more than two months after it experienced that hack. This decision is likely due to the news that Nonghyup Bank would resume its partnership, which, uncoincidentally, comes right after the SK government officially approved Bithumb, along with a few other exchanges (UPbit and Korbit among them), of meeting their standards for security.
Also uncoincidentally, in the recent days Bithumb has climbed from 19th, less than a week ago, to today's 5th highest volume exchange on Coinmarketcap, from $60 million to over $350 million daily average - a nearly 6 times increase!
As one news article states,
The resumption of Bithumb registration will lead to an influx of capital in the crypto exchange market of South Korea, especially in the mid-term, as new investors that have previously been unable to trade will now be able to access Bithumb and its liquidity.
And, to end this on the most positive note possible...
...this from the same article...
The federal government has also reaffirmed its intent to facilitate the growth of the cryptocurrency and blockchain sector in the long run, as a part of its larger initiative to bolster the fourth industrial revolution.
Fourth industrial revolution, you say? Count me in!
Resources
https://cointelegraph.com/explained/south-korea-and-crypto-regulations-explained
https://www.cnbc.com/2018/01/29/south-korea-cryptocurrency-regulations-come-into-effect.html
https://cointelegraph.com/news/south-korea-finance-minister-confirms-no-ban-on-cryptocurrency
http://fortune.com/2018/06/20/south-korea-cryptocurrency-hack/
Whether or not a high technology is being adopted by South Koreans is a great indicator. South Korea has traditionally been very early to adopt new tech. This is very comforting considering how rapidly they're buying up crypto :)
Yes, both Japan and South Korea are historically (looking back over the last few decades) good indicators of what technologies are likely to be widely adopted within the next decade, which both happen to be in the top 3 countries for crypto trades and transactions. This is very good news for us early adopters of the tech.
I see Bithumb is right at the top of the Steem market with huge volume, but the price?
I wonder how long it will take to come down there, or if the other exchanges will move up to meet it..
Oh. I had no idea that it had reached that high on the list for Steem. I was basing all of this data on the day old resources that I was using for this post and, for whatever reason, never thought to even check coinmarketcap for up to date numbers.
As to the large gap of prices between Bithumb and the other exchanges, that's something that has been happening pretty consistently for at least the last half of a year, if not more (I can't recall that far back). I think SKs are willing to pay that premium due to difficulties of trading outside of SK exchanges presented by their laws, but I could be wrong about that.
As attractive as it may look for arbitrage, I deem it's near impossible to make an account there if you live outside of SK.
If Steem deposits are enabled on bithumb, I may have to find me a SK friend with a bithumb account and we could work the system quite easily. Buy Steem on bittrex, withdraw to friend to deposit on bithumb and sell to BTC then withdraw btc to bittrex and buy more Steem.. and repeat. That will see prices going down on bithumb, and up elsewhere to meet somewhere in the middle.
Not impossible, but looks like only a few cryptos have deposits and withdrawals enabled for now.
Good idea. I'm going to go out on a limb and assume that Steem is one of the currencies that they don't allow you to deposit...?
Yeah, looking at their twitter feed, BTC, ETH, ETC, XRP, LTC, BCH, ZEC, QTUM, MITH, MCO and MXR are the only ones open for now. They probably have quite a mess to sort out before openning everything up again.
Big news for the market, South Korea was behind a lot of the action we saw in the run up in December/Jan.
Indeed. And they will also be a lot of the action that we'll see in the next run up!
Seems like the big players are back in the game this is gonna be interesting :D
Hope so @blazing :)
Big news for the market, South Korea was behind a lot of the action we saw in the run up in December/Jan.
@originalworks