Bitcoin plummets 30 per cent in just three weeks as investors fear massive cryptocurrency crackdown in China and South Korea
THE value of Bitcoin has plummeted more than 30% in the last three weeks thanks to a looming crackdown in China and South Korea.
The cryptocurrency has fallen in value for four straight days and is today down to $14,042 from a record $20,000 on December 17, according to Coinmarketcap.
Market-leader Bitcoin is also losing ground to rivals like ethereum, ripple and cardano.
In mid-September, China's central bank, the People's Bank of China (PBOC), told virtual currency trading platforms based in Beijing and Shanghai to cease market operations.
Authorities also clamped down on ethereum and any other electronic units that are exchanged online without being regulated by any country.
South Korean authorities late last year banned financial institutions from dealing in virtual currencies on fears of a bubble fuelled by retail speculators.
About one million South Koreans, many of them small-time investors, are estimated to own bitcoins and demand is so high that prices are around 20% higher than in the US.
Bitcoin is a virtual currency that was created in 2009 by an unknown computer whizz using the alias Satoshi Nakamoto.
Transactions are made without middle men, so there are no transaction fees and no need to give your real name.
More businesses are beginning to accept them and in some parts of the world you can even buy pizza with Bitcoins.
Bitcoins aren’t printed, like pounds, dollars or euros – they’re produced by people, and increasingly businesses, running computers all around the world.
It’s the first example of a growing category of money known as cryptocurrency.
Bitcoin is attractive to some users because of its anonymity, as well as its lack of government control.
BEATS AND BITCOIN
Japan has a new all-girl band - the Virtual Currency Girls - on a mission to educate the public about bitcoin and other cryptocurrencies.
Each of the eight girls in the band, known in Japanese as "Kasotsuka Shojo", plays a character representing a virtual currency such as bitcoin, ethereum or ripple.
Promotional material shows the performers wearing character masks, frilly mini-skirts and "maid" aprons complete with knee-high socks.
The Virtual Currency Girls are due to hold their debut live concert in Tokyo on Friday, according to their management company Cinderella Academy.
In keeping with the theme, payment for merchandise will be accepted only in virtual currencies.
"We want to promote the idea through entertainment that virtual currencies are not just a tool for speculation but are a wonderful technology that will shape the future," said the group's leader Rara Naruse, 18, in an online statement.
The value of Bitcoin, like all currencies, is determined by how much people are willing to exchange it for.
To process Bitcoin transactions, a procedure called 'mining' must take place, which involves a computer solving a difficult mathematical problem with a 64-digit solution.
For each problem solved, one block of Bitcoin is processed.
In addition, the miner is rewarded with new Bitcoin.
To compensate for the growing power of computer chips, the difficulty of the puzzles is adjusted to ensure a steady stream of new Bitcoins are produced each day.
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