South Korea is going to ban cryptocurrency traders using anonymous bank accounts
The country plans to tax domestic digital currency exchanges and calls on them to share users’ transactions data with banks
Will Blockchain become more attractive to investors?
UBS chairman advises against investing in Bitcoin speaking at the World Economic Forum in Davos
Bitcoin (BITCOIN) failed to break above its crucial resistance during the yesterday’s session while South Korea could have been among reasons behind the price underperformance. Notice that the country released a long-awaited decision with regard to cryptocurrency trading on Tuesday saying that the use of anonymous bank accounts in cryptocurrency trading will be banned from 30 January. The move was aimed at stopping digital currencies from being used for money laundering and other crimes. Even as the verdict is not so bad as it would be (notice that the country was considering a full ban of all exchanges) new measures could cut back on using virtual currencies. As a result the price of Bitcoin slumped and broke through quite an important demand zone once again. As we have pointed for several days bears seem to keep control on the market and a quick look at the H4 chart confirms it.
Bitcoin failed to move through an upper limit of a descending channel. Consequently the price slipped below a critical support line at around $10,900 drawing a bearish engulfing pattern thereafter. Therefore, one may assume the price might resume its downtrend moving toward a lower boundary of the channel.
The selective ban imposed by the South Korean watchdog was not the sole decision taken earlier today. The country also said that it will collect up to 24.2% of corporate and local income taxes from the country-based virtual currency exchanges this year according to the Yonhap News Agency. Furthermore, the government ordered digital currency exchanges to share users’ transaction data with banks. Finally let us explain that since 30 January cryptocurrency traders in South Korea will not be allowed to make deposits into their e-wallets unless the names on their bank accounts match the account name in cryptocurrency exchanges. All of that weighed on the Bitcoin price which now is trying to rebound though.
Blockchain has a chance to become more attractive to investors
According to the data collected by Bloomberg investments in the blockchain technology sped up in the first quarter of the last year reaching more than $140 million. What’s more, if Bitcoin and other digital currencies are regulated, it could help make the blockchain more attractive to investors via increased credibility as digital currencies could become a safe way to transfer value as a result of proposed controls designed to tackle terror finance.
Investments in the blockchain technology accelerated in the first quarter of 2017 after four back-to-back declines.
UBS Chairman Axel Weber advises against investing in Bitcoin
The World Economic Forum in Davos has just begun and UBS Chairman Weber was one of the first who spoke publicly. He said that the bank makes a distinction between institutional and retail cryptocurrency traders. While the former may have the sufficient capability of judging risks related to investing in Bitcoin, the latter should be protected from going into these products (digital currencies) as they do not fully understand virtual coins. Therefore, Alex Weber underlined he would advise against investing in Bitcoin for retail traders pointing to some banks being criticized for selling complex financial products prior to the global financial crisis without explaining them in a step-by-step manner.