Bitcoin prices dropped below $10,000 today, falling past this key, psychological level after investors responded to the latest South Korean regulatory developments.
The cryptocurrency’s price reached $9,972.29, according to the CoinDesk Bitcoin Price Index (BPI).
At this price, the world’s largest digital currency by market capitalization had plunged roughly 50% from the all-time high of nearly $20,000 that it reached late last year, additional BPI data shows.
[Ed. note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
South Korean Crackdown
South Korea announced that starting January 30, the nation’s investors will no longer be able to trade digital currencies using anonymous bank accounts, CoinDesk reported.
Under new rules, market participants will need to make sure that the name they supply to an exchange is the same as the name on their bank account before making any trades, according to CoinDesk.
“The South Korean announcement is the reason for the pull back,” said Charles Thorngren, CEO of Noble Alternative Investments.
Charles Hayter, co-founder and CEO of data provider CryptoCompare, offered a similar take, stating that South Korea’s actions have been a “fear factor” that have been pushing traders to sell.
Thorngren singled out a few different factors that heightened the impact of this latest regulatory announcement.
“The crypto community has heard this before, however, with a softer market cycle right now it bears more weight,” he said.
Thorngren also emphasized the recent surge in new crypto investors, noting that these traders are not used to announcements like this one.
“The recent influx of investors who are less familiar with Cryptocurrencies trade in and out of them more rapidly than the establish base of investors,” he stated.
Disclosure: I own some Bitcoin, Bitcoin Cash and Ether.