CryptoWatch: Bitcoin tumbles as South Korea moves to curb crypto trade

Bitcoin prices plunged on Thursday, with spot prices erasing more than $1,500 after South Korea announced tougher measures to crack down on cryptocurrencies trade.

Prices on CoinDesk tumbled $1,196, or about 8%, to $14,182, trimming its market cap to $238 billion. Just 11 days ago, the currency BTCUSD, +1.93%  traded at almost $20,000 after a one-month buying frenzy that sent it up more than 1,800% on the year, with a total value of more than $300 billion, fueling fears of a speculative bubble.

January futures traded BTCF8, +2.36% on the CME Group Inc. CME, +0.25%  dropped $945 or 6.4%, to settle at $13,745, with a low $13,350 on the day. For the week, futures are down about 10%.

Comparable futures XBTF8, +2.14%  on the Cboe Global Markets Inc. CBOE, +0.07%  shed $1,190, or 8%, to settle at $13,755. Cboe futures hit a low of 13,580 for the session.

The sharp losses on Thursday came after South Korea’s government proposed new legislation that will ban the use of anonymous cryptocurrency accounts starting next month and shut down the country’s bitcoin exchanges. The move is seen as a further step in attempting to curb widespread speculation in the bitcoin market.

“The reality is that the market is way too overheated and no one wants the cryptocurrency popping on their door steps. However, this is surely not the first time that we have witnessed this kind of reaction in the bitcoin price. Throughout this years, we have heard many similar messages (followed by actions) from China and yet bitcoin made a high of $19,338,” said Naeem Aslam, chief market analyst at Think Markets, in a note.

Read: Bitcoin bull John McAfee urges cryptocurrency investors to hold on

—Mark DeCambre contributed to this article

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