Panic selling ensues after South Korean exchange raids

South Korean tax investigation into exchange platforms caused a massive selloff in cryptocurrency market
11 January 2018   138

Yesterday's news about South Korean authorities instigating inspection raid at two major exchanges are still shaking up the cryptocurrency market. And now not only by sensational value. The panic selling off started recently and the exchange rates quickly started to reflect the mood of the market.

And now into a little more detail. As everyone interested in the topic knows, the Asian traders have a significant impact on world crypto markets. So significant, in fact, that South Korean authorities crack-down on the residential exchange platforms and the possibility of all-out crypto ban may have caused the market to take a nose dive.

This week the second largest in the world crypto exchange Bithumb was forced do disclose all their paperwork to tax collectors and explain to local police, that their platform has no relation to gambling. The last part may be humorous, but the underlying message should be clear – “the Big Brother is watching you” for the exchanges, and will be doing it a lot closer from now on.

Also there are instances of banks that offer crypto accounts being investigated under “crime prevention” pretense. Local news outlet Yonhap News reports that the South Korean Government is developing a set of laws to abolish anonymous trading accounts.

The following media frenzy has caused a massive selloff this morning during the start of trading. And various news outlets falsely reporting that South Korea has banned cryptotrading as a whole doesn't help matters. All of this resulted in massive price drops in Bitcoin, Etherium and Litecoin.

SEC Suspends Trading in 3 Companies

On Friday The U.S. Securities and Exchange Commission temporarily suspended the trading of three companies as they made the purchase of cryptocurrency and blockchain-related assets
17 February 2018   126

According to the announcement, the trade of  Cherubim Investments, Inc., PDX Partners, Inc., and Victura Construction Group, Inc. will be suspended between 9:30 a.m. EST Friday and March 2. The notice was dated Feb. 15.

SEC stated that its trading suspension orders state that recent press releases issued by CHIT, PDXP, and VICT claimed that the companies acquired AAA-rated assets from a subsidiary of a private equity investor in cryptocurrency and blockchain technology, among other things.

The release also indicates additional reasons for the suspensions. The agency’s orders also say there are questions regarding the nature of the company's business operations. In case of CHIT, the Commission suspended trading in the securities because of its delinquency in filing annual and quarterly reports.

In August 2017, the SEC  issued a warning for investors about the companies that may publicly announce ICO or coin-related events to affect the price of the company’s common stock.

Fraudsters often try to use the lure of new and emerging technologies to convince potential victims to invest their money in scams. 

U.S. Securities and Exchange Commission