Bitcoin prices struggled to reclaim $11,000 Tuesday, coming under pressure as officials in South Korea announced new measures to regulate trading in cryptocurrencies.
On the heels of a rough session that sent bitcoin stumbling by 10% at one point, a single bitcoin
was down 2.26% on Tuesday to fetch $10,528.49, according to research and data site CoinDesk.com.
On the futures market, bitcoin prices showed some signs of strength. The February contract
on Cboe Global Markets Inc.
was up 2.3% to $10,450, while January futures
on the CME Group Inc.
were up 1.8% to $10,545. That contract expires on Friday.
“The cryptocurrency remains unable to break through $12,000. That level has been tested on Thursday, Friday and Monday and rejected and now bitcoin seems to be unable to break out past $11,000 and was last trading at $10,500,” noted Neil Wilson, senior market analyst at ETX Capital, in a note to clients.
Wilson said if bitcoin breaks below $10,000, then it could retest the January 17 low of $9,200, and from there, $8,000 would be the next level that could be taken out. Going the other way, he said if it can move above $12,000, then the next level of resistance is $13,200.
South Korea cracks down
Bitcoin sagged as South Korean officials, who have been exploring tighter bans on trading, announced new measures. The Financial Services Commission (FSC), the nation’s finance watchdog, on Tuesday laid out its strategy to curb speculation in cryptocurrency trading. As part of that, it will ban anonymous accounts linked to digital currencies.
“With the real name policy coming into effect at the end of this month, the existing ‘virtual accounts,’ anonymous accounts that have been widely used to trade cryptocurrencies, will no longer be in use,” the FSC said.
The body said it also approved guidelines from the Financial Supervisory Service (FSS) and the Korea Financial Intelligence Unit (KoFIU) for banks to prevent cryptocurrency money-laundering. “High-level due diligence” by financial institutions in any transactions with cryptocurrency exchanges are just one of the guidelines.
On Monday, Yonhap News Agency reported that the government plans to collect 24.2% of taxes from the country’s cryptocurrency exchanges this year. Wall Street Journal reported that cryptocurrency platform OKCoin will open in South Korea as early as next month.
Swiss-based commodities fund Tiberius on Monday announced plans to launch the first digital coin —tcoin — pinned to industrial metals, such as copper and aluminum, Reuters reported. There are currently other digital coins backed by precious metals.