Bitcoin was trading at about a 30 percent premium over prevailing international rates on Thursday in Seoul, according to price data from local exchanges, a continuing sign of the country’s obsession, and the difficulty in arbitraging between markets.
“Cryptocurrency speculation has been irrationally overheated in Korea,” the government said in the statement, which comes little more than a week after the bankruptcy filing of one South Korean exchange. “The government can’t leave the abnormal situation of speculation any longer.”
Singapore’s monetary authority warned last week that digital currency buyers should be aware they could lose all their money, joining counterparts who’ve warned about speculative mania surrounding bitcoin, which has surged more than 1,300 percent this year even after today’s selloff.
“Regulators are getting so concerned that this is primarily and predominantly a retail phenomenon,” said Stephen Innes, head of trading for Asia Pacific at Oanda. “Regulators not only in Asia but globally are going to start addressing this fact because I don’t think they’ve actually come to terms with what the absolute downside of a complete drop in crypto means for the economy.”
For a menu of cryptocurrencies on the Bloomberg: VCCY
For bitcoin prices: XBT Curncy
Article Appeared @https://www.bloomberg.com/news/articles/2017-12-28/bitcoin-drops-as-south-korea-says-exchange-closures-are-possible