South Korean Regulation Crashes the Market
Looks like another deadly day for cryptocurrency as almost EVERYTHING out there is down today on it's 24 hour trading period. Some of the bigest losers include RaiBlocks(XRB) down 24%, Electronium down over 18% and even our beloved Steem is down 16% as of this writing.
New Regulations
The dip is likely because new regulatory rules in South Korea that just passed recently went into effect today. In a document published on Jan. 23, the regulator said it would only allow trade in cryptocurrencies from real-name bank accounts beginning Jan. 30. Those rules enabled banks to comply with their KYC AML (know your customer, anti-money laundering) obligations, the document said.
Overall , I think it could be good thing for the crypto space - but with investors already fickle about anything perceived as negative - the move has already resulted in billions of dollars shaved off the market. We have seen a lot of crypto news coming out that part of the world. Just recently over $400 Million worth of NEM was stolen from a Japanese exchange. As with most of these knee jerk reactions, I suspect that investors will soon forget all about it and move on to the next piece of crypto news and start making plays on that.
Is Regulation the Answer?
Eventually, investors will come to see regulation as a good thing - but wasn't the whole idea of crytocurrency supposed to allow us to use money anonymously, securely, and without the overbearing shadow of the centralized banking system hovering over us? I can see why investors and speculators could take this as another nail in the coffin for crypto. However, if countries and banks are responsible for regulation of the digital dollars, then we will be able to see much more widespread adaptation of it. There are always going to be rogue coins that don't play by the rules and allow for crypto to be used as intended - but with the bigger players getting involved - regulation could lead to billions of dollars flowing into the space as it becomes a legitimate asset class. From an investors standpoint - this is a positive thing.
Time to Buy?
I always look at opportunities like this as a good time to get in - an old adage in investing in the stock market says to
"Buy up what others are throwing away and sell off what others are buying up"
It's a contrarian model - but it makes a lot of sense. The markets move up and down all the time - if you can catch something while the price has dropped because everyone else is panicking -you could find yourself sitting on top of a nice gain when the dust settles and everyone else realizes that the price is too low to pass up. I'm not suggesting trying to time the market - but when things are on sale go buy them!
Do you think this downturn will last long or is just a case of "Nervous Nellies" pushing the market down temporarily?
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I always upvote comments to my blog posts
Buy when others are fearful! :)
Used up my fiat for buying coins the last time others were fearful (i.e. last week). This bear market has gone for nearly 1.5 months.
just remember that everything is about moderation - don't throw your money at coins just because they are cheap - look at the fundamentals and figure out which coins you want to own for the long term - then when a good buying opportunity comes along - take advantage of it
that has always been my philosophy!