Bitcoin fell 18 percent on Tuesday, reaching the lowest level in four weeks, close to $11,000. The decline comes amid fears that South Korea might ban cryptocurrency trading.
The decrease in Bitcoin triggered a large-scale sell-off in the broader market of cryptocurrencies. The rate of the BTC’s rival Ethereum fell 23%, according to the Coinmarketcap, while the price of Ripple fell 33%.
According to the South Korean news agency Ryonghap, Finance Minister Kim Dong-yeon said on the air of a local radio station that the government considers the ban on Bitcoin and other cryptocurrencies a “live option.”
On Monday, South Korea reported that plans to ban crypto trading have not yet been approved, as agencies continue to negotiate to decide how to regulate this market.
Bitcoin fell 18% to $11,191 on the Luxembourg-based Bitstamp Exchange and could show the maximum one-day drop in three years.
“The cryptocurrency is mostly pressured by regulatory issues, and the catalyst today is news from South Korea,” said Naim Aslam of brokerage firm Think Markets.
“But we adhere to our position. We do not consider it possible to ban cryptocurrency completely,” he added.
Bitcoin lost more than 40% compared to its record high near $20,000, reached in mid-December, while its market capitalization declined by about $ 130 billion.
A senior representative of China's central bank urged the authorities to introduce a centralized ban on trading virtual currencies, as well as prohibit individuals and companies from providing related services, according to a government document that was revealed by Reuters.
At the same time, a member of the board of governors of the central bank of Germany said on Monday that any attempts to regulate cryptocurrencies should be global since it is practically impossible to enforce rules at the national or regional level in an unlimited virtual community.