The Korean president’s office on Thursday moved quickly to quell panic in the global cryptocurrency market after a senior official said the government has decided to dismantle local exchanges as part of its sweeping effort to clamp down on digital-currency trading.
“No official decision has been made,” a senior presidential aide told Korean reporters in response to a warning earlier from Minister of Justice Park Sang-Ki that government agencies are working together to further regulate the market and shut down cryptocurrency exchanges.
“Minister Park was discussing just one of the measures that the Justice Ministry is considering,” the senior aide told Yonhap News.
Read: Bitcoin tumbles on reports South Korea will ban all cryptocurrency trading
Korea’s Justice Ministry also released a follow up statement that it is working with other government offices to craft a special law to shutter cryptocurrency exchanges but a final decision on the matter is pending.
How Korea handles cryptocurrencies is being closely watched by global investors given that it is one of the first countries to indicate that it will strengthen oversight of a market that is viewed as operating outside of usual regulatory framework.
Separately, the Korean constitutional court is holding a preliminary review on whether it is constitutional for the Korean government to regulate the cryptocurrency market and whether it has the legal right to ban cryptocurrency trading, according to Yonhap News.
Spot price of bitcoin
fell 2.8% to $14,078, according to CoinDesk. It had earlier slumped to trade below $13,000.
Bitcoin futures for January
on the CME dropped 2.3% to $14,115, and on the Cboe, bitcoin futures
declined 2.4% to $14,100.