The Bitcoin, Ripple and Ethereum have just collapsed following an announcement by the South Korean Minister of Justice. The Minister wanted to suspend or even prohibit all exchange of cryptocurrencies on the territory. Following this statement made on the morning of 11 January 2018, the global cryptocurrency market as a whole lost more than $100 billion in value in a matter of hours. Many alarmist articles concluded that cryptocurrencies would be banned. However, the South Korean government has just denied it and is dissociating itself from the statements made by its minister.
Short-term disaster for the small world of cryptocurrencies.
At a press conference on 11 January 2018 this morning, South Korea's Minister of Justice Park Sang-ki announced that South Korea will pass a law to ban all virtual currency transactions on its territory. The government is concerned about this new phenomenon and suggests that cryptocurrencies exchanges could be suspended. It didn't take any more than that to panic the markets!
Bitcoin, Ripple, Ethereum: a wind of panic blows over cryptocurrencies
The price of the Bitcoin dropped by USD 2,000 and its world price on the GDAX fell by 12% before rebounding in the following hours. Alternative currencies (altcoins) were hit even harder. The world price of Ethereum dropped by 9%, and the Ripple directly dropped by 50%. According to CNBC, the global cryptocurrency market as a whole lost $106 billion in a matter of hours.
However, the South Korean government has denied its intention to suspend or even ban cryptocurrencies on its territory. The announcement taken up by the Reuters news agency, was reportedly made independently by Justice Minister Park Sang-ki without consulting the Prime Minister beforehand - several ministries dissociated themselves from these statements, including the country's finance ministry, which would have learned of these statements like everyone else through the press.
Of course, this price volatility will be interpreted by some as further proof that cryptocurrency may ruin you. As a reminder, China is until now the only country to have banned the exchange of cryptocurrencies.