Date
23 September 2018
News that South Korea’s financial regulator is easing its stance on bitcoin and other cryptocurrencies has given traders confidence to buy, analysts said. Photo: AFP
News that South Korea’s financial regulator is easing its stance on bitcoin and other cryptocurrencies has given traders confidence to buy, analysts said. Photo: AFP

Bitcoin nearly doubles in value from year’s low

Bitcoin hit a three-week high on Tuesday and has surged nearly 100 percent from its lowest level this year, as its recovery continued after South Korea’s financial regulator eased its stance on cryptocurrencies, Reuters reports.

Choe Heung-sik, governor of the Financial Supervisory Service, said the government will support cryptocurrency trading if “normal transactions” are made, according to South Korean news agency Yonhap. Reuters was unable to verify the Yonhap report.

“While the threat of heavy regulation, or even a total ban on exchange trading, has hovered over bitcoin in recent weeks, reports this morning that the South Korean government are softening their stance have given traders confidence to buy,” said Dennis de Jong, managing director, at online brokerage UFX.com in Limassol, Cyprus.

South Korea has been pushing for broad regulatory supervision of cryptocurrency trading as locals, including students and housewives, have entered the market despite inherent risks and warnings from policymakers around the world of a bubble.

Seoul previously said it was considering shutting down local cryptocurrency exchanges, which threw the market into turmoil and hammered bitcoin prices. Officials later clarified an outright ban is only one of the steps being considered, and a final decision was yet to be made.

On the Luxembourg-based Bitstamp exchange, bitcoin hit a three-week high of US$11,722.58 on Tuesday. It was last up 3.4 percent at US$11,555. From this year’s low of US$5,920 in early February, bitcoin has surged nearly 100 percent.

“Bitcoin’s price history suggests that months of consolidation are followed by weeks of rapid advancement,” said Canaccord Genuity in its latest research note.

“The safest way to benefit from potential bitcoin price appreciation is to buy and hold for the long term; trying to time it might be too difficult.”

Bitcoin has been pressured this year by a slew of regulatory initiatives around the world, including the incidence of hacks on exchanges. The latest hack occurred a few weeks ago when roughly US$532.9 million in digital money was stolen from Tokyo-based cryptocurrency exchange Coincheck.

Other digital currencies, however, showed mixed results, diverging from bitcoin for now. Ethereum, the second-largest by market value, was down 1.3 percent over the past 24 hours at US$935.02, while the third-largest, Ripple, fell 1.6 percent to US$1.13, according to cryptocurrency price tracker coinmarketcap.com.

Litecoin, the fifth largest cryptocurrency by market capitalization, was one of the biggest gainers with a 9.3 percent rise at US$246.03. The currency jumped as much as 10 percent after a “hard fork” resulted in the creation of a new cryptocurrency called litecoin cash.

– Contact us at [email protected]

CG

EJI Weekly Newsletter

Please click here to unsubscribe