It sent a shockwave around the crypto-currency world when it was announced that South Korea was preparing a law to ban trading of Bitcoin and other virtual currencies within their borders. They would be the first major country to do something like this. This news obviously sent a chill down the spins of everyone who believes in the growth and promise of the future of these types of currencies.
The Justice Ministry in South Korea is who is preparing the bill to have trading in virtual currencies banned says Yahoo! News. Not only is South Korea coming at it from a legal standpoint, but they have also raided the offices of two of the largest virtual currency firms in the country. They are on the lookout for illegal behavior.
This is troubling because South Korea is one of the major markets in which virtual currencies are traded. In fact, the major of trading in Bitcoin (and others) comes from Asia as a whole. If other countries in the region start to adopt policies similar to what South Korea has decided to do, then most of the trading volume in virtual currencies could disappear overnight.
Different countries have taken different approaches to this phenomenon. Some like South Korea and China have adopted harsh policies against virtual currencies. On the other hand, Japan went out of its way to recognize Bitcoin as a legal currency. Japan even plans to regulate the currency in the same way that it regulates the bills that it produces as well. This news helped to skyrocket Japan to the top of the leaderboard when it came to virtual currency trading. That could be a very big deal if it turns out that virtual currencies really do continue to take off as they have up to this point.
Regulation of virtual currencies is expected in a number of countries in the very near future. All of these different countries are watching as crypto-currencies take off wherever they are available. While they are white hot in popularity at the moment, governments will feel the need to step in and regulate them at least to some extent. Allowing them to remain in the free-for-all kind of state that they have been in up to this point is just not going to cut it. It will be a race to see which countries develop which kinds of regulations and how strict those regulations are.