Cryptocurrencies to remain strong in 2018

By Kang Seung-woo

Cryptocurrencies’ thrilling ride is expected to continue in the New Year, according to market watchers, Monday.

Since bitcoin was launched in Jan. 3, 2009, as the first digital token, the cryptocurrency market has been expanding to approximately 1,400 virtual currencies that have gone to astronomical highs. According to the industry tracker coinmarketcap.com, the global cryptocurrency market was valued at roughly $605 billion (645 trillion won) as of Monday morning.

Last year, nowhere had the frenzy over digital money been as feverish as in Korea. The value of bitcoin, the leading cryptocurrency, jumped by 16 times, while that of Ethereum increased a whopping 95 times. Ethereum was the second-most valuable cryptocurrency in 2017, now overtaken by Ripple, though.

Chairman Kim Hyung-joo of the Korea Blockchain Industry Promotion Association said the value of cryptocurrencies will continue its upward trajectory.

Blockchain is an emerging electronic ledger technology that was recently thrust into the spotlight as it underpins bitcoin and other virtual currencies.

“The current sharp upward trend in the cryptocurrency market is just the beginning. As there is more demand for them and new cryptocurrency exchanges are established along with new developments of improved crypto coins, there is plenty of room for digital money to gain more value in the future,” Kim said in a media interview.

“In addition, investors recent figured out that bitcoin is not the only digital token, so they are paying more attention to others, including Ethereum, which will play a key role in diversifying the market and eventually further growth.”

Kim’s prediction is shared by experts overseas, who expect bitcoin could be worth $60,000 by December 2018.

“I think we’re going to see bitcoin hitting the $60,000 mark,” cryptocurrency entrepreneur Julian Hosp told CNBC.

As this year is expected to be a decisive year for bitcoin and other cryptocurrencies, the local cryptocurrency market got off to a solid start on New Year’s Day.

As of 2:50 p.m. Monday, bitcoin was trading at 19.1 million won, 3 percent up from a day earlier, and Ethereum soared by 4.24 percent to 1.05 million won. Ripple was trading at 2,700 won.

As the cryptocurrency craze is looming large, the government has stepped up efforts to cool the red-hot market -- a stumbling block for the digital money to retain its meteoric price hike.

According to the government’s measures, only real-name bank accounts and matching accounts at virtual currency exchanges can be used for deposits and withdrawals, while the issuance of new virtual accounts to cryptocurrency exchanges will be banned, Hong said.

Such exchanges will also be banned from issuing virtual accounts to new clients.

Fearing the cryptocurrency bubble is about to burst, the government issued repeated warnings of the risks, but to no avail.

In order to prevent “the current abnormal situation of speculation from going on any longer,” the government even considered shutting down cryptocurrency exchanges.

After the United States and Japan, Korea is the world’s third-largest market for cryptocurrencies.