Bitcoin has had a wild ride this week, starting out at $11,000 and surging to over $18,200 seven days later. The market has now started to correct and BTC has fallen back to around $13,500 at the time of writing. The massive rush in demand has highlighted a number of inherent flaws in the system. Major exchanges such as Coinbase were overwhelmed with traffic and transactions which brought the site to a grinding halt once again. At the peak of the trading frenzy there were over 250,000 transactions pending.
Quick to point this out was the Litecoin Foundation who tweeted “There are 223K unconfirmed bitcoin transactions right now… use Litecoin!” As Bitcoin fell back from its dizzy heights funds started to pour back into altcoins which have taken a beating this week. The current front runner in the altcoin race is Litecoin which is up around 50% at the time of writing.
Often referred to as sliver to Bitcoin’s gold, Litecoin has been far more stable in previous months trading slowly upwards from $40 to $60 over the past six months. In mid to late November things started to move a bit quicker for Litecoin which jumped up to $80 and beyond reaching stable ground at around $100 where it has stayed for the last fortnight.
On Saturday however it has exploded and jumped a massive 65% to just over $160. The Asian trading session had been dominated by Litecoin which is traded heavily in South Korea. There have been a couple of conflicting stories coming out of South Korea in recent days regarding the government’s stance on crypto currencies and ICOs.
CoinTelegraph reported that there would be a complete ICO ban in South Korea while other sources, including Korean news publication Chosun, reported that the government would soon allow ICOs for institutional investors. According to the report a task force has been formed by the South Korean Ministry of Strategy and Finance, Financial Services Commission, Ministry of Justice, Fair Trade Commission, and Financial Supervisory Commission. Its purpose is to prepare various regulatory frameworks for businesses and investors to operate within the crypto currency industry.
It is clear that while South Korea remains open and accepting of crypto currencies it is striving for more regulation to prevent fraudulent ICOs and scams. “The South Korean government has no other choice but to follow the regulatory frameworks and trends established by other leading governments. While there certainly exists a negative reputation attached to the cryptocurrencies, the government’s stance is to allow what has to be allowed, for the benefit of the South Korean market.”
The recognition of cryptos and ICOs is likely to have caused the surge in Litecoin which is a dominant asset on Korean exchanges such as Bithumb. Currently the market has corrected a little and LTC is trading at around $135, still around 33% up on two days ago.