Ethereum News Update
There’s a lot going on in Ethereum news this month.
India is apparently exploring ways to crack down on virtual currencies, meaning that we could see more volatility in ETH prices over the next few weeks. (Source: “India to bar cryptocurrencies from its payments system: finance ministry official,” Reuters, February 5, 2018.)
But we haven’t gotten to that bridge just yet.
There are some indications that India’s approach won’t be as severe as China’s. For example, it will reportedly appoint a new regulator for overseeing crypto exchanges. This suggests a full-scale ban is not on the table.
Rather, I’m expecting some sort of notice saying that virtual currencies are not—and never will be—accepted as legal tender. But that’s not exactly a shock. India’s finance minister already made that clear in 2017 and again last month.
In other news, Coincheck opened its doors for the first time since it was hacked…and investors withdrew $373.0 million. (Source: “Notice of Japanese yen transfer,” Coincheck, February 13, 2018.)
Clearly, the Japanese crypto exchange is low on trust. The fact that it hasn’t obtained a license to operate in Japan is not going to help matters.
Ethereum Price Chart
However, this particular hack doesn’t expose other cryptocurrency exchanges to similar risk. Only one type of cryptocurrency was stolen from Coincheck (it was NEM), and the exchange had failed to activate all security features offered by that crypto.
It’s an easy fix, in other words.
Last on today’s docket of Ethereum news is South Korea, which probably sounds more ominous than it should. South Korea is continuing to insist that exchanges abide by know-your-customer (KYC) regulations. (Source: “Korean Government Remains Firm on Crypto KYC Mandate,” CoinDesk, February 14, 2018.)
This enforcement would effectively outlaw anonymous crypto trading.
I personally believe this is going to become a global trend. There are international standards about money laundering that would become impossible to implement without KYC rules in place. As such, national governments could follow South Korea down this regulatory path.
Fortunately, ETH prices shouldn’t be harmed in the long run. In fact, investors are already shrugging off the impact of Korea’s ruling. Prices are up 5.6% against the U.S. dollar today, bringing the Ethereum to USD exchange rate to $894.59.
We remain confident about our $1,500 Ethereum price forecast for the second quarter of 2018.