South Korea's Justice Ministry has said it's preparing a bill to ban cryptocurrency trading, throwing the virtual coin market into turmoil. The nation has been a crucial source of Bitcoin demand.
South Korean police units and tax authorities raided local exchanges on alleged tax evasion, Reuters reported Thursday.
South Korea's largest cryptocurrency exchanges like Coinone and Bithumb were raided following moves by the finance ministry to identify ways to tax the market that had become as big as the nation's small-cap Kosdaq index in terms of daily trading volume.
The clampdown in the country came as policymakers around the world struggled to regulate cryptocurrencies as an asset whose value had skyrocketed over the past months.
More virtual money, more crime?
"There are great concerns regarding virtual currencies, and the justice ministry is preparing a bill to ban cryptocurrency trading through exchanges," Justice Minister Part Sang-ki said at a press conference.
Bitcoin's 1,500-percent surge in value last year had stoked huge demand for this and other virtual currencies in South Korea, drawing in demand from various sectors of society and sparking worries of a gambling addiction.
Financial authorities had previously said they were inspecting six local banks that offered virtual currency accounts to institutions amid concerns the increasing use of such assets could lead to a surge in crime.
hg/aos (Reuters, FT)