By Gaurav S. Iyer, IFC Published : January 11, 2018
This week, tax authorities (and in some circumstances, regulation enforcement officers) investigated South Korean cryptocurrency exchanges on claims of money laundering. At the similar time, the Korean authorities considered a bill to impose strict pointers on crypto shopping for and promoting all through the nation.
I really feel you’ll guess the impression on crypto prices…
Everything is in freefall. Ripple prices are notably arduous hit, falling 12.86% in the direction of the U.S. buck, and bringing the XRP to USD value proper right down to $1.70.
From my preliminary analysis, consumers are bracing for one extra Chinese-style cryptocurrency ban. This would sever all conversions from native fiat foreign exchange to crypto money, nonetheless would depart crypto-to-crypto transactions intact.
However, there’s motive to think about that A) Korea’s ban is completely completely different from China’s, and B) XRP can survive each mannequin, if need be.
First, let’s take into consideration the variations.
Capital flight was China’s important concern about cryptocurrencies. The idea that residents would possibly merely evade foreign exchange controls by switching to Bitcoin or Ethereum was infuriating to the Chinese authorities’s notion of top-down administration.
Korea’s motivation is totally completely completely different—authorities are frightened about money laundering. As a consequence, they might choose to ban anonymous shopping for and promoting of cryptos comparatively than dumping the entire market inside the trash.
Ripple (XRP) Price Chart
I personally don’t ideas the idea of linking personal identification to purchasing and promoting accounts. It has the twin outcomes of shaking out authorized components whereas preserving the robust base of Korean crypto retailers. It’s an inexpensive technique.
But even when Korea follows China down the road of intolerance, XRP needn’t fall apart eternally. Yes, it is true that Korean retailers helped arrange momentum for the foreign exchange, nonetheless the similar was true for Litecoin and its relationship to Chinese exchanges.
LTC prices slumped inside the aftermath of China’s shopping for and promoting ban—nonetheless then they recovered. OKCoin and Huobi ceased to play an crucial place in Litecoin’s future. The gap they left was crammed by completely different exchanges, resembling GDAX and OKEx.
In the similar technique, I am unable to take into consideration that Ripple prices will endure eternal damage from a attainable Korean shopping for and promoting ban. Other exchanges will fill the void left by Bithumb, Korbit, and Coinone.
The current value droop smells like different. Investors that groaned about missing Ripple’s sharp ascent ought to consider their second likelihood sooner than it’s gone because of our Ripple value prediction nonetheless reveals XRP reaching $10.00 in 2018.