Bitcoin Drops to $13,000 in Tumultuous Trade Ahead of New Year

Bitcoin prices briefly fell below $13,000 on Saturday amid news that South Korea was moving to regulate domestic cryptocurrency exchanges.

BTC/USD Price Levels

The value of a single bitcoin reached a session low of $12,000 on Saturday following a broad correction in the market. At press time, BTC/USD was trading at $13,084, a 5% drop from the previous close. Bitcoin has shed more than 3% over a volatile five days.

With the most recent decline, bitcoin’s overall market was valued at $220 billion. More than $15 billion in bitcoin was transacted over the last 24 hours, with activity spread out across multiple exchanges.

Bitfinance processed 6.5% of daily transactions, which amounted to roughly $969 million. Binance’s XRP/BTC pair accounted for more than 5% of the daily volumes. Heavy buying of XRP/BTC was also present on Bittrex and Poloniex. This partially explains Ripple XRP’s recent string of record-setting gains. The so-called bankers’ crypto leapfrogged Ethereum on Friday to become the world’s second-largest digital asset behind bitcoin.

Bitcoin’s price levels have been volatile over the past week, with the market experiencing multiple pullbacks following a brief stint near $20,000 on Dec. 17. Over the past five days, values have fluctuated between $12,000 and $16,500.

South Korean Regulation

On Thursday, South Korea announced a series of measures to rein in speculation on domestic cryptocurrency exchanges. Authorities issued a freeze on new crypto accounts and banned users from trading anonymously. Brokers that do not comply risk losing their business.

Seoul is prepared to do much more to curb market volatility, including issuing an all-out ban on cryptocurrency trading, according to a top government official. According to CCN, Hong Nam-ki of the Office for Government Policy Coordination said authorities “will consider” shutting down bitcoin exchanges if the recent measures fail to cool an overheated market.

“We are planning to consider every possible measure in the future, including the shutdown of exchanges,” Hong said on Saturday, according to BusinessKorea, a Seoul-based English-language news service.

Meanwhile, a report from The Korea Times indicated that the Ministry of Justice has already proposed a blanket ban on cryptocurrency trading. It remains unclear whether government authorities will action the proposal.

A ban on crypto exchanges would be a major blow to a market that has flourished in South Korea. The country accounts for roughly 20% of global bitcoin transactions, which is roughly ten times its share of the global economy.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock. 

Author:
Chief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi