South Korean ministry weighing cryptocurrency trading ban says there’ll be ‘careful consideration’

South Korea's justice ministry reportedly softened its stance after remarks from its minister roiled the cryptocurrency market on Thursday
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South Korea’s justice ministry appeared to have softened its stance after remarks from its chief on Thursday saw billions wiped off the global cryptocurrency market.

News agency Yonhap reported the ministry explained that the ban was not a done deal in a text message to reporters on Thursday.

“The ministry has been preparing a special law to shut down all cryptocurrency exchanges, but we will push for it after careful consideration with related government agencies,” the ministry said.

Empire Media reached out to the justice ministry for further clarification, but did not immediately hear back.

On Thursday, Justice Minister Park Sang-ki said at a press briefing that there were “great concerns regarding virtual currencies” and that the ministry was “basically preparing a bill to ban cryptocurrency trading through exchanges.”

Park said he couldn’t disclose more specific details about a proposed shutdown of cryptocurrency trading exchanges in the country, adding that various government agencies would work together to implement several measures.

News of his ministry’s plans roiled the cryptocurrency market and bitcoin price fell as much as 12 percent in the aftermath.

Later in the day, however, South Korea’s presidential office emphasized that any potential bill is not a final measure.

“Justice Minister Park Sang-ki’s remarks regarding the shutdown of cryptocurrency exchanges is one of the measures that have been prepared by the Justice Ministry, but it is not a finalized decision and will be finalized through discussion and a coordination process with each government ministry,” the chief press secretary to President Moon Jae-in said in a statement reported by Yonhap.

Even if a bill aiming to ban all cryptocurrency trading is drafted, it will require a majority vote in the country’s National Assembly before it can be enacted into law. That process could take months — or even years.

On Friday morning at 8:27 a.m. HK/SIN, bitcoin traded at $13,013.1 and ethereum traded at $1,138.3, according to CoinDesk data.

South Korea is one of the biggest markets for major coins like bitcoin and ethereum.

According to industry website CryptoCompare, more than 10 percent of ethereum is traded against the South Korean won — the second largest concentration in terms of fiat currencies behind the dollar. Meanwhile, 4.3 percent of all bitcoin are traded against the won.

Cryptocurrency trading in the country is very speculative and the prices of bitcoin, ethereum and other coins are significantly higher than elsewhere in the world. Authorities have taken steps in recent months to limit speculation in the market, including prohibiting cryptocurrency exchanges from issuing new trading accounts.

Last month, the government also said it would consider taxing capital gains from trading of virtual coins, according to Reuters.

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