How a South Korean Bitcoin Exchange Proved RBI Right on the Cryptocurrency

On Wednesday, news agency AFP reported that bitcoin prices plunged about 15 % in Asian trade as investor sentiments took a hit on news that a South Korean exchange had been hacked. Some of the loss however, got compensated after the initial slump.
Reports appeared that South Korean exchange Youbit had been hacked, leading the firm to say it will shut down and start bankruptcy proceedings.

Independently, US authorities on Tuesday suspended trading in a famous Bitcoin-related stock, citing concerns about market manipulation.

The Crypto Company’s share price had risen 1,700 % between the end of September and Monday evening before the Securities Exchange Commission intervened to halt trades until January 4.

“Both the news of South Korea’s exchange having been hacked and position modification following recent rallies affected the market today,” Raita Yamaguchi, senior consultant at Nomura Research Institute, told AFP.

However, “the weight of South Korea as a Bitcoin market is not that big,” he added.

The report arrives in the backdrop of different regulatory authorities in India raising red flags over trading of bitcoins and other cryptocurrencies. On December 6, the central bank said The RBI had already said those trading in virtual currencies were doing so at their own risk, given that the central bank has not given a licence or authorisation for any company to deal in such cryptocurrencies. It wanted to reinforce its previous message to “customers, holders and traders of Virtual Currencies (VCs) including Bitcoins regarding the potential economic, financial, operational, legal, client protection and security related risks associated in dealing with such VCs.”

The income tax department, Sebi and finance ministry too, have warned bitcoin traders and investors over the erratic nature of the cryptocurrency world.

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