In the early of hours of January 16th, 2018, many investors woke to a dramatic dip in the value of their cryptocurrencies. Since bitcoin reaching an all-time high last month this came as a shock to some of the more than 10% decrease and continued descent of the coins price. To some, this is a sign that the bitcoin bubble has finally burst, but let's examine the real reason why there was a dip in the price of bitcoin and why this is not a time to panic sell.
Recently the cryptocurrency tracking website, coinmarketcap.com, had removed South Korea from their algorithm in order to give a more accurate readout of the price of each currency. This had made users upset as the website neglected to inform users they had done so.
The fact of the matter is that Asian countries own a significant chunk of the cryptocurrency market. Many of the governments of these Asian countries have taken legal action in order to make cryptocurrency taxable just as the United States of America recently has. For example in Japan citizens pay a twenty percent premium on bitcoin. Coupled with fact that China is expected to pass a regulation banning domestic access to cryptocurrencies this is causing a time of unrest in the market full of panic sales of valued crypto.
This, in my opinion, are the wrong actions to be taking at this time. I don't believe that all the legislation will pass in these countries. Cryptocurrency is hard to regulate as is, but if you give tech-savvy individuals a wall in which to climb they will find a way around it. Through the use of VPN's, cloud mining, and other methods these Asian can still share in the cryptocurrency market. Now while it might be illegal to use VPNs and other such methods to avoid pinning down someone's origin or to get around a countries firewall it hasn't stopped people from doing it before. The number of people participating in the mining and purchase will of course fall as if the regulations in these countries are put into place large mining operations will more than likely be stopped.
After this onslaught of regulations has passed the market will stabilize once more. With each and everyday people hearing about the wonders of cryptocurrency and the freedom it offers more from around the world will join and supplement the lost individuals from the Asian countries. Knowing this means that you should hold onto your valuable cryptocurrency as it will soon regain its value.
