Anxious Asian Authorities Grapple with Crypto
The nations of Asia are responsible for well over half of the total global volume of cryptocurrency trading. The Asian trading session often dictates how the rest of the day will play out when traders wake up in Europe and the US. However, the governments of the region are growing uneasy about the increasing appetite their people have for cryptocurrencies.
One of the world’s largest exchanges, Bitfinex, is owned by a Hong Kong-based company. South Korea’s Bithumb is also a huge player for crypto trading volume, and then there is Binance, bitFlyer, and Coinone, all based in Southeast Asia. There is no doubt that Asians are the driving force when it comes to trade volumes.
According to a CNBC report, regulators in the Asia Pacific region have become increasingly uneasy with the rise in popularity of Bitcoin and its brethren. The latest to express concern was the Bank of Japan governor, Haruhiko Kuroda, who called the recent surge in Bitcoin prices “abnormal” in a press conference this week. His counterparts in South Korea, Singapore, and Australia have echoed the sentiment.
Huge volatility has been cited as reason for regulation. Bitcoin has lost over 30% in less than a week, and most of the altcoins are currently following its fall, at least temporarily. With large regulated US exchanges and institutions, including Goldman Sachs, CBoE, CME, and TD Ameritrade, taking an interest and starting to offer products based on cryptocurrencies, the governments in Asia want it under control.
Many countries in Southeast Asia, including China, Vietnam, Thailand, Indonesia, Myanmar, and Cambodia, have virtually no democracy and are managed by single-party politics or military regimes. The only thing that matters is control; the human rights and civil liberties that we enjoy in the West are forgotten dreams in much of Asia.
After its market-shaking move to prohibit ICO trading in September, China stands by its stance that the unregulated market could pose major financial risks to the world’s second largest economy. The People’s Bank of China is in support of the technology, though, and moves to launch its own sovereign virtual currency are underway. Chinese platforms, such as NEO, are already in use and have a lot of future potential.
Japan is one of the few Asian countries to officially recognize and legalize cryptocurrencies and exchanges. There are currently no plans to release an official state coin, but there is a Japanese crypto called Monacoin in use in the country, and Cardano has been dubbed by some as the Ethereum of Japan.
South Korea and India are concerned about money laundering and illegal use of cryptocurrencies for criminal purposes, so they are seeking to regulate exchanges and demand more personal information from those that want to trade. Indonesia and Vietnam are both in the process of banning Bitcoin and crypto outright, while Thailand and Singapore have both issued alerts about the risks but continue to allow trading and exchanges.
Will regulation in Asia impact the global market? Share your thoughts in the comments below.
Images courtesy of Pxhere and Bitcoinist archives.