Nigel Green, chief executive of DeVere, said: "Nothing has captured the imagination in this new fintech age quite like cryptocurrencies, specifically Bitcoin". However, the government has not finalized plans to ban virtual coin exchanges, Reuters reports. Other agencies in South Korea such as the Fair Trade Commission, the Financial Supervisory Service and the Bank of Korea banned its employees from trading digital currency during business hours.
Bitcoin approached a record $20,000 in mid-December as it launched on futures exchanges in the United States. The currency, which is notorious for its wild swings in value, had steadied a little at the time of writing, with a value of $12,078 on the popular Coinbase exchange. The country has seen a huge bitcoin craze, with young and old betting on the cryptocurrency to build wealth.
Chinese regulators will seek to prohibit domestic access to foreign platforms that "enable centralised trading" as well as "target individuals and companies that provide market-making, settlement and clearing services for centralised trading", sources told Bloomberg. According to Coinmarketcap, around 58% of Ripple's current 24-hour trading volume have been generated by four South Korean platforms - Bithumb, Upbit, Coinone and Korbit. It reached $13,000 from $19,000 - and then momentarily bounced back to $17,000. Now, South Korea has come out and said they are considering banning cryptocurrencies.
Lukman Otunuga, research analyst at FXTM forex forecaster, also blamed the market jitters on the political regulatory backdrop surrounding the sector, which topped $600 billion in market capitalisation in mid-December.
This is one of the biggest falls - which is likely to lead the markets towards a major crash.
Bitcoin was trading at $12,615.60 USA, down 7.1 per cent from the day before as of 8:03 a.m. GMT, according to Coindesk.
Bitcoin related stocks fell hard in pre-market trading on the stock market today.
"We've heard reports that South Korea, China and Japan have considered a shared approach, a path, to regulation", Wilson said, also citing a challenge to digital coins from a bill in the US Senate. In Tuesday trade, bitcoin and ethereum dipped 15% and 14%, respectively.
Look away now if you own bitcoin or other cryptocurrencies.