Home Tech This Cryptocurrency Is Soaring Today While Bitcoin and Ethereum Plunge

This Cryptocurrency Is Soaring Today While Bitcoin and Ethereum Plunge

319
SHARE

Many major cryptocurrencies were plunging on Thursday, as South Korean regulators talked about tighter regulation of blockchain currencies in that country. But one of the largest crypto-coins swam against the current, posting a large gain instead.

What’s new?

According to a Reuters report Wednesday night, South Korean government officials want to make it harder to speculate in cryptocurrencies. The country may soon impose new regulations on virtual coin trades and exchanges, including a ban on anonymous cryptocurrency accounts and the option to close down rule-breaking coin exchanges promptly.

“The government had warned several times that virtual coins cannot play a role as actual currency and could result in high losses due to excessive volatility,” said a spokesman for South Korea’s Office for Government Policy Coordination at a press conference. Street prices of Bitcoin, Ethereum, Litecoin, and many other cryptocurrencies plunged 5% or more within minutes of that Reuters story hitting the news wires.

South Korea is home to some of the world’s largest virtual currency exchanges, which act as liquidity buffers and trading platforms for cryptocurrency users around the world. In many ways, South Korea is blazing a path for other cryptocurrency regulators to follow.

The local blockchain industry recently agreed to tighter transparency rules and larger asset requirements for Korean virtual currency exchanges, and those rules will take effect next week. The country is also looking into taxation of capital gains from cryptocurrency trading.

How to buck the downtrend

At the same time, the third-largest cryptocurrency by market cap took a big step forward.

The Ripple coin, known as XRP, zigged while other digital currencies zagged, rising 9.4% as of 1:40 p.m. EST. All told, Ripple prices have surged from 0.6 cents per coin at the start of 2017 to $1.46 per coin as of this writing — a 243-fold increase.Thursday’s big gain was powered by positive news out of Japan, where Ripple started up a new partnership with a consortium of credit card companies to get the digital currency into the hands and wallets of regular consumers. Ripple was founded as a blockchain-based money transfer service, giving banks and consumers a low-cost way to transfer cash across international borders at the drop of a hat.

Adding more credit card issuers to Ripple’s portfolio of partners moves the coin closer to achieving that long-term goal.

“One of the things we all have to remember is the value of a token over the long term is really going to be driven by its utility,” said Ripple CEO Brad Garlinghouse in a recent interview with CNBC’s Squawk Alley. “What problem is it solving? How big is that problem? How many customers do you have?”

So his digital currency is addressing the real-world problem of slow and expensive international money transfers, hoping to avoid the trap of becoming an empty vessel for flimsy speculation.

For those keeping score at home, this is the same Brad Garlinghouse who penned the famous “peanut butter manifesto” as a senior vice president of Yahoo!. His resume also includes many years of angel investing and leveraged buyouts at firms like Silver Lake Partners, giving him a solid mix of technical and financial know-how. I’m not surprised to see a cross-sector star like Garlinghouse joining the front lines of the blockchain business.

Source:www.finance.yahoo.com