When markets are volatile and crashes occur, the majority of people are cashing out and taking profits or panic selling. There are some, however, who see opportunity in the sea of red and buy up at lower prices. This is exactly what has been happening in Singapore this week when Bitcoin ATM machines ran dry.
According to reports, Bitcoin machines in downtown Singapore sold out of the virtual currency yesterday as prices plummeted below $10,000 for the first time since the end of November.
Lions and Bulls
Amid more confusion over clampdowns across the Asia Pacific region, prices fell and markets dropped as much as 40% since highs just after New Year. Much of the impetus for crypto market prices originates in Southeast Asia where they are traded heavily. Western media outlets, such as Reuters and CNBC, amplify the FUD when they misreport about total clampdowns that have not occurred.
Singaporeans, however, remain unperturbed and have been snapping up the digital currency at low prices. One café manager who has a Bitcoin ATM told media:
We had to put an ‘out of service’ sign at our machine. Over the past two days, we’ve had 20 to 30 people line up, from about 10 on a usual day.
Bitcoin Exchange founder Zann Kwan, who owns two machines on the island state, said the buying frenzy was bigger in December as BTC approached record highs:
Sellers are holding back in anticipation of higher prices, so we have less bitcoin supply. Buyers on the other hand are hoping prices will crash some more, so they can buy.
Experienced crypto traders and Bitcoin investors will know that market corrections are nothing new. However, a wave of panic sets in when those who are new to the markets rush to sell off their crypto for fears of a complete collapse. The despair was wide-reaching with suicide helplines appearing in crypto groups in the US. Additionally, South Koreans posted pictures of smashed up computers in anger at their government’s constant indecision and threats to close exchanges.
The official stance of the Monetary Authority of Singapore was outlined to the media:
MAS regulates the activities that surround virtual currencies if those activities fall within our scope as a financial regulator. The risks surrounding virtual currency exchanges include those related to money laundering and terrorism financing (ML/TF). Virtual currency transactions, given their anonymous nature, are particularly vulnerable to abuse for ML/TF. MAS will therefore introduce anti-money laundering and countering the financing of terrorism requirements on virtual currency intermediaries that deal in or facilitate the exchange of virtual currencies for real currencies. The regulations will extend to the exchange of virtual currency for fiat currency, or another virtual currency.
As in South Korea, the government wants more transparency and less anonymity with cryptocurrency trading. It does not want to shut it down.
Do you use Bitcoin ATMs to buy and sell? Let us know your experiences in the comments below.
Images courtesy of Wikimedia Commons and Bitcoinist archives.