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  1. This is a video of a national assembly member (congressman) questioning officials of the FSS (Financial Supervisory Service). It's in Korean so I'll give you the highlights. 1. Government officials don't understand blockchain They were asked what they knew about block chain and admitted not much. The nat. assembly member chastised them for making announcements regarding banning blockchain and exchanges when they clearly didn't know what blockchain was. -The funny part was when the nat. assembly member asked the official if he was embarrassed by his lack of knowledge and there was just a weak "yes" in response. Hahaha, ouch. -The takeaway is government statements about block chain seem to have been reactionary and just now it seems they're moving to learn more about it to create a regulatory framework. They didn't know much about it when they were making announcements about possibly banning it. -I am never surprised by the incompetence of government. 2. Government officials (from the ministries that have been tasked with regulating it) have been investing in crypto - perhaps improperly There is an ongoing investigation about an employee of one of the ministries buying and selling crypto. Apparently, before the minister of justice made his boneheaded announcement last week, a civil servant (his / their job title was never revealed) sold their crypto. The official confirmed an investigation was ongoing. I am a little confused about the person(s). At times, this person was called an "employee" and at other times a "civil servant". I don' t know why the discrepancy and the nuance people were trying to communicate with these two different terms. -frankly, I see this as possible but unlikley. EDIT: (Update) This is true. A member of the task force sold crypto just before the announcement and bought after. His/her name wasn't revealed, nor the coin. He said that he only made a 7,000,000 won (about 6,700 usd) profit but nobody believes this to be true. 3. National Assembly member hints at impropreity He criticizes the ministries for inconsistent and panic causing announcements that caused large drops in the market and losses for "ants" or small investors. He notes, these could absolutely be opportunities for people in the know to use insider information (knowing the content of these announcements before they were made) to profit. A member of the FSS pushes back on this at the end. He says the justice minister's comments were not a formal announcement but an answer to a question asked by a reporter. As a result, it would be difficult for an civil servant to know ahead of time what was going to be said, and execute a trade with that information. -I have a feeling this story is going to be continued to be updated in the coming weeks. There have been accusations of this type of behavior but no proof. However, given the lack of regulation, I don't even know if this is illegal. However, it is clearly a moral hazard. 4. Explanation of the justice minister's boneheaded statement There were two: 1. Every ministry is concerned about how blockchain affects their portfolio. Some ministries are concerned about the outflow of money etc... The justice minister approaches this issue from the point of stopping money laundering and financial crimes. It is for this reason, he felt strongly about it and said he would ban it. -I think this is weak justification. 2. Investors in korea pay a large premium. The prices in Korea are very inflated. This is a concern to the ministries and they want to address this. In their efforts to eliminate the premium, they misspoke when addressing the press. They will be more careful in their choice of words in the future. -Nonsense. He is giving a weak excuse and playing the martyr at the same time. The takeaway This seems like a warning to the FSS, probably as a result of the incredible anger from citizens. It seems like a warning to: 1. Stop creating instability in the market. 2. Create a consistent a policy direction soon. Instead of wondering aloud about what to do to the press, learn about blockchain and come up with a regulatory proposal. 3. Everybody is looking to see if there is impropriety coming from these ministries so be careful. 4. Your words have an effect on the market and have hurt investors so choose your words carefully. 5. You (FSS) are making yourselves look bad.
  2. I don't know if people were expecting a bull run. This was not the issue. The concern was if banks/cryptoexchanges didn't increase the number of new accounts, it may be part of a plan to ban crypto markets, also there would be little new money flowing into the market. This led to selling. It is now clear this is not true. They will allow new accounts to be created. How this affects the market? I don't know.
  3. 1. Korean government will allow cryptocurrency trading. It has made an announcement during a press briefing. It will allow it but cautioned people to do so prudently. It also made people aware that it would not offer protections for people who suffered losses in the market. I think the caveat that it would not offer protection is in response to many people who petitioned the government to help them get their money back when they suffered losses. Yes, this really happened. Some people asked the government to help them reclaim money that they lost trading crypto. Their logic was that because it was not currency, and there was no law regarding crypto, the government could order exchanges to return their money or take other measures. These people drive me crazy. 2. Banks and crytpo exchanges will allow new accounts after January 21. There was an announcement. 3. Explanation of recent drop in prices in Korea and growing hints of manipulation in Korea There is a growing amount of FUD in Korea adding to instability. I do not like conspiracy theories but there is growing evidence of manipulation in Korea. There was rumor that some people with deep pockets bought crypto during the drop after the ministry of justice's bombshell announcement last week that it would seek to ban cryptocurrency which was an "error". The minister has since backtracked. It happened again. It is disappointing because the latest comes from a reputable newspaper...again. A reporter wrote an article that banks and crypto exchanges would NOT allow new accounts after January 21. This was posted on the site of a large news organizations. It caused panic selling. However, since then the reporter has backtracked and said the article was not a statement of fact but an opinion. She backtracked again and adjusted the article. Now, because of threats of a lawsuits, she has deleted her facebook page, set her instagram on private, and has gone quiet. Many people are threatening lawsuits because they believe she either bought on the dip or was paid to write that article by others who bought on the dip. I don't know this is true but I also don't buy this was another innocent mistake, or this article was written without an agenda. There have been too many mistakes for all of these to be shoddy journalism. Link to the article http://news.joins.com/article/22288162 Link to the reporter explaining the changes she made to the article https://blog.naver.com/wnekqls11/221185669449 4. Another coming announcement from the government but it may not be important The government already announced it would not stop cryptocurrency trading. However, many people have petitioned the government on the Blue House (Korean equivalent of the White House) website to clearly articulate their position on cryptocurrency. If 200,000 people sign the online petition, the government must formally respond. There are over 200,000 petitioners. However, given the statement they just made, people expect the response to be a formality, and a repeat of their most recent statement.
  4. You're welcome. As I mentioned before. There is news on message boards about the Moneygram agreement and most comments about it are positive. It would be fair to say there is a lot of discussion. However, it hasn't reached a mania like level. I'm sure there would have been much more discussion of Moneygram if it weren't for the bomb that was dropped by the ministry of justice yesterday.
  5. Interesting read. However, I want to add that there was no "raid" on exchanges. The government announced beforehand they would be visiting and inspecting exchanges to ensure they were complying with government guidelines. You can't call it a government "raid" if the government announces they are going to exchanges. I feel this added to yesterday's panic.
  6. The banks haven't been opening new accounts since December 29. The government banned virtual accounts and said they needed time to match accounts on crypto exchanges with 1 real bank account. I don't know the answer to your second question. Your guess is as good as mine. There is a lot of FOMO but there is a noticeable increase in trolls talking about bubbles/crypto exchage bans.
  7. Yes, but the news was muted because of the fiasco of yesterday (ministry of justice announcement of a possible move towards banning exchanges). Many people were / are skittish about jumping back into the market. I spoke to somebody who said, if not for the ministry of justice announcement yesterday, XRP had a chance to jump up to 5,000 won. I think that is an exaggeration but his point that it would have given a substantial boost to XRP prices is probably correct. Today, there is some news about the Moneygram agreement. The vast majority of Korean crypto investors don't know much about the company. However, the news on message boards today seems to be two things. 1. Moneygram is a large company 2. People seem very positive that XRP is going to increase in value.
  8. Many people in Korea were hesitant to invest because the direction the government wanted to take was unclear. Additionally, there were plenty of trolls in Korea scaring crypto investors saying the government would close all crypto exchanges. It appears the uncertainty about government regulations may have dissipated Originally, it was planned that all exchanges were not going to open new accounts until about January 21st so the government could match all crypto exchange accounts to a real bank account. However, yesterday's announcement by the minister of justice caused confusion. Also, the Shinhan bank created confusion by stating that it was likley they may not allow real bank accounts to be linked to a new crypto account after then. This caused anger among many people who threatened to close their Shinhan bank accounts and take their business elsewhere. Shinhan, upon realizing it caused more anger than expected, reversed course and said this wasn't their final decision and they would delay making this decision. This afternoon, the government called a meeting with all banks in Korea. It was unclear why the meeting was called. However, right around the time when the meeting should have ended there was an uptick in trading and the prices of coins started to rise, as if people in the know started their usual buying/trading patterns. The news on the street, unconfirmed, is that the government said they would follow their original plans and allow new crypto accounts to be opened after the 21st. The feeling is that the government will not close exchanges and instead move towards regulation and taxation of cryptos, and allow new exchange accounts after the 21st. There seems to be the start of a return of some normality in the Korean crypto market.
  9. This comes from the Blue House (the Korean equivalent of the White House) Basically, the ban on crypto exchanges in Korea is NOT the position of the government. He says many different ministries have different positions on cryptocurrencies. A decision on cryptocurrencies must be based on the views of many different ministries. He says what was announced today was the opinion of the ministry of justice, not a decision made by the government. He notes some ministries want to "nurture" these core technologies. http://news.naver.com/main/read.nhn?mode=LSD&mid=sec&sid1=100&oid=052&aid=0001104792 EDIT: people are unhappy again. Many people lost a lot of money. There was note of somebody dumping huge amounts of ethereum today, ouch.
  10. Some members of the task force on cryptocurrency were surprised by the announcement that exchanges were to be banned because an agreement was not reached. Not all participants (ministries) in the task force think banning exchanges is a good idea. http://www.edaily.co.kr/news/news_detail.asp?newsId=03109446619076736&mediaCodeNo=257&OutLnkChk=Y
  11. For Korean investors already in crypto, this is correct. However, government regulations create barriers. First, ultimately most investors want to convert crypto back into fiat. They are investors for profit not because they believe in the technology or want to disrupt the way money is currently handled. If the government makes it difficult to convert from fiat into crypto, or vice versa, that is a barrier to investment/exchange of crypto. Think back to the days when people who wanted to trade crypto would sometimes arrange to meet strangers in person to exchange bitcoin for money. Also, many Korean investors are not sophisticated investors. Much like in the US. Remember, it is possible to buy XRP in the US but everybody hopes XRP is listed on coinbase because of its large user base and the ease with which this user base can buy/trade XRP. Buying crypto with fiat becomes easy. Coinbase users could easily purchase crypto on another exchange if they really wanted. However, for whatever reason, they don't. One of the reasons many Koreans invested in crypto was the relative ease with which it could be done. For example, all you had to do was pop into the coinone branch in Yoido and 5 minutes later, you have an account. Although it is not difficult to create an account online, some people still found it easier to visit the physical branch. Ease of use is important to the casual investor. I feel that anything that adds, any extra step to investing in crypto will be a barrier for many people. Many of the investors, don't really know very much about crypto at all. They invest in it because somebody in the office made some money, or somebody's uncle made some money, or their boyfriend/girlfriend's friend is doing it. I"m afraid they don't really know what bitcoin, XRP, or ethereum do. If there is any concern, or added steps, I think some people will opt out. In order for crypto to grow, use or exchange has to become easier for the average person. The crypto fluent people will always use it but there aren't enough of them to affect great growth. It has to become a retail proposition. Like how companies bend over backwards for Walmart to get their products in their stores.
  12. There are currency remittance laws in Korea. The government restricts money leaving the country. You can do this with some money but not large sums. You can send up to 50,000 dollars a year from Korea to another country. However, if it is being sent to a business, you may be asked to provide documentation explaining who will be receiving that money and for what purpose. Right now, the government is pressuring banks to not send any money related to crytpocurrency outside the country. I spoke to people at branches of a number of banks about this (Shinhan, KEB/Hana, SBI). They said they would not send crypto related money out of the country. It appears the government is asking banks to not take any action until government regulations are put in place. In short, from my conversations with banks, it is difficult or not possible to send money related to crypto out of the country now.
  13. This article seems most legit. However, I take issue with the word "raid". That word seems unnecessarily harsh. I read in another paper where the government termed it a "visit". The government announced they would be visiting exchanges to see if they were following government guidelines before they went to the exchanges.
  14. 01.11.2018 Korea sell off with some notes about the Korean crypto investor There is is a sell off in all crypto in Korea at the moment. (Edit, seems to have bottomed out since I began writing this article.) I write this post to give people a little insight into the Korean market. I want everybody to understand that there is great enthusiasm, and instability. Don't place too much faith in the Korean crypto investor. Case in point, Roger Ver was recently on Korean TV to talk about cryptocurrencies. However, most people were talking about a 23 year-old who was also on TV because he claimed to have started with a 80 dollar investment and turned it into a 30 million dollar crypotocurrency portfolio. To me, the story about the investor doesn't completely ring true. However, this encapsulates the both the interest, craziness, and the growing mania surrounding cryptocurrencies in Korea. Reason for the sell off today: Comments made to reporters at noon today. 박 장관은 이날 과천 법무부 청사에서 열린 신년 기자간담회에서 "가상화폐에 대한 우려도 굉장히 커 법무부는 기본적으로 거래소를 통한 가상화폐 거래를 금지하는 법안을 준비 중"이라며 이같이 말했다. 정부는 지난달 28일 가상화폐 투기 근절을 위한 추가 특별대책을 추가로 내놓을 때 비이성적 투기 상황을 방치할 수 없다면서 거래소 폐쇄를 위한 특별법 제정도 검토하겠다는 입장을 공식적으로 밝힌 바 있다. Park said at the New Year's Press conference held at the Gwacheon Justice Office on the day, "The Ministry of Justice is preparing legislation that basically prohibits virtual currency trading through exchanges. The government has officially announced that it will consider imposing a special law on the closing of exchanges, saying, "We can not neglect irrational speculation when we add additional special measures for eradicating virtual currency speculation on September 28. How people -that I spoke to - are viewing this in Korea This is not new. As the article states, this is what the minister stated in September of 2017. It seems unlikley. However, because it was said again, it is causing concern for some in Korea. The rumor mill in Korea This is not to stoke rumor but give people an insight into some of the crazy conversations that people are having in Korea. You can compare this to some of the conversations on this forum. Unfortunately, there may be less investment based on fundamentals in Korea than in other countries. A great amount of investment, but not all, is driven by crazy rumors and here is some of that. Don't place all of your trust in the rationality of crypto investors because as you know, there may be very little of that. Also, don't place all of your trust in Korean investors just because the volume of Korean investment is so high so they must be more enlightened because they are able to quickly recognize emerging trends. There is a lot of craziness in investment/investors here as well. Without further delay, here are some rumors today: 1. The government may move towards closing exchanges (this seems unlikely. with the amount of money circulating through exchanges, and the potential economic stimulus this could bring it seems unlikley...unless the government feels confident they can push all of this money back into the stock market, but this is unlikely.) 2. The government is moving towards curtailing money laundering by conglomerates (There is a rumor that Hyundai is using crypto to build slush-funds outside of Korea - this is in line with the conduct of conglomerates in Korea. This has always gone on. Recently, the former chairman of Samsung is catching heat for hidden wealth/stocks. Probably true, but unlikely that it can be the main motivator of government policy. ) 3. The government is trying to push down prices to encourage investors to not leave the stock market, or encourage investors to move back towards the stock market (I haven't seen the figures but somebody stated 5 trillion won left the Korean stock market) 4. The government is trying to push down prices before a wave of new crytpo investors expected in late January 5. Politicians in Korea are pushing down the market so they can find an entry point and invest themselves. (This is most likely untrue but funny. This rumor is probably circulating because Korean politicians so so incredibly corrupt. They are very, very, very corrupt. What is probably true is that they are muscling operators of exchanges for kickbacks. The focus over and over again has been the amount of money circulating through the exchanges and how it is unregulated.) 6. Wild rumor - Chinese crypto exchanges will open again. The rumor, is that somebody sued the chinese government for the money he lost when they closed the exchanges. The supreme court ruled the government is not liable for losses but that the petitioner should have been able to buy and sell on exchanges. (This one seems like the craziest rumor. I would bet on this one being part of a pump and dump strategy with an altcoin) Side Note 1 One of the people involved in statements about banning crypto (Choi Heung-sik, Director of the Financial Supervisory Service,)is really angering people. There is an online petition on the Blue House (Korean equivalent of the White House) website to have him removed from his position. I support this. He doesn't seem to be in step with officials and the current policies in other countries. However, despite the petition, his removal seems unlikely. I believe, but not sure if I can trust my memory 100%, that he has a little bit of a vendetta against crypto. If I remember correctly, in a press conference in the past, he assured reporters that bitcoin was a fad. He asked if anybody wanted to bet that the price of bitcoin would drop because he believed it would. Well, it didn't at the time and reporters being reporters, they needled him about this. I believe he was a little embarrassed. Side Note 2 There is increasing pressure for government regulation. I spoke to a lawyer who is suing the government on behalf of crypto investors in Korea. He says regulation is coming. There are many complaints by investors who feel they have been wronged by crypto exchanges. They claim fraud (crashes of exchange servers at times when it is beneficial to the exchanges) and unfair practices (the high premiums levied by exchanges). While some are suing the government to relax restrictions, others are petitioning the government launch regulatory measures.
  15. This is good. It gives crypto legitimacy and recognition. It should encourage new people who were worried about fraud and uncertainty to invest. The drawback is that it is one step closer to taxes. Taxes are inevitable anyways.
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