Bitcoin prices crash below W11 mil. mark
Bitcoin’s price crashed more than 10 percent over a day, Wednesday, falling below 11 million won ($9,000) as the value of other major virtual currencies also fell over 15 percent.
Market analysts said behemoth investors’ exit from the cryptocurrency market caused the plunge in the value of virtual coins. Due to their exit, retail investors also went into panic selling mode based on inflated fears.
According to the nation’s largest crypto exchange, bitcoin’s price stood at 10.2 million won as of 2 p.m. Wednesday, down 1.3 million won, or 11.29 percent, from a day ago.
Coinmarketcap.com, the world’s most widely used virtual coin tracker, said the value of bitcoin nosedived 12.62 percent to $8,528.58 in the same period. The value of ethereum also dropped 16.15 percent over a day to $169.23, Wednesday.
Bitcoin had surged to over the 16 million won mark last month following a massive influx of Chinese investors influenced by the trade row between the U.S. and China.
Facebook’s plan to introduce its own cryptocurrency was another factor behind bitcoin’s uptrend in August.
However, the value started showing signs of decline after bitcoin and other virtual coins were ruled as neither legal tender nor financial assets by the International Financial Reporting Interpretations Committee (IFRIC).
The IFRIC is a not-for-profit international interpretative body of accounting practices associated with International Financial Reporting Standards (IFRS) Foundation under the International Accounting Standards Board (IASB).
“The IFRIC’s decision could have seeded the crash Wednesday,” said a domestic blockchain developer who asked not to be named.
“It seemed major investors dumped their virtual coins after the IFRIC’s announcement. Retail investors then went on a wave of panic selling to minimize their losses. I believe, however, the situation could settle in the near future. Once Facebook comes up with a more elaborated timetable with its plan to introduce the new Libra cryptocurrency, virtual coin values will surge once again.”
During the National Assembly hearing last month, Financial Services Commission Chairman Eun Sung-soo displayed his reservation on virtual coins’ entry to the nation’s financial system.
“In a bid to protect investors and financial service customers, financial authorities should come up with a new set of regulations to monitor virtual coins’ flow,” he said.