Person 4: Kim Do-young, a 34-year-old
audio producer in Seoul, said he was drawn to Bitcoin because it was easy to
open an account and it was a good chance to make a fast money (Bloomberg, 2017).
It is a freedom of financial accessibility, which people could have.
Side Two Argument – Agree
1: Park Sang-Ki, South Korean Justice Minister, commented that the proposed shutdown
of exchanges is one of the measures suggested to curb speculation (Browne,
2018). Bitcoin trading could jeopardize South Korean economics, as the
government has no track of citizens’ financial routes.
Person 2: Lee Dong-Gwi, a psychology
professor at Yonsei University stated “in a practical sense, the South Korean
government needs to factor in some political aspects – if a growing number of
people lose huge sums of money on Bitcoin because of the government’s failed
attempts to rein in the frenzy, people will blame the government” (Kim & Yang, 2018). This statement argues the petitioners’ request as if there is a burst
in the cryptocurrency, then
citizens will blame the government for neglecting.
Person 3: Aurelian Menant, Chief Executive
of Hong Kong based exchange Gatecoin, said that there might be a black market
where people cash out offshore and able to pay in won for your Bitcoins (Kim & Yang, 2018). This argument supports the South Korean government
on restrict the cryptocurrency trading because an awareness of illegal money.
4: Koh Young-Sam, a 56-year old mechanic in Seoul, warned that the craze would
collapse. “Young people shouldn’t be lured into this kind of scam. There
is always something fishy about things that grow this fast,” Koh said (Kim & Yang, 2018). This statement supports government concerns how to tax and regulate
online currencies as well as
protect citizens from being scammed.
The first solution is that the South
Korean government should boost transparency in trading of cryptocurrencies (Kim
& Lee, 2017).
Advantages of this solution are;
identity confirmations which will be made by traditional financial institutions
such as banks, consumers’ safety and transparency in trade which allows
government to monitor trading activities (Ward, 2015).
However, the disadvantages are; the vulnerability of Bitcoin wallets when purchasing
Bitcoins, they are stored in a digital wallet on the user’s mobile device or
computer, and digital keys can be lost, damaged or stolen; uncertain security
from theft and fraud, while the counterfeiting of Bitcoins is allegedly impossible,
the system has sometimes found itself vulnerable to large security breaches and
cyber-attacks (Ward, 2015).
The second solution is to maintain
light regulations while encouraging a vast ecosystem of companies and investors
around digital assets by pioneering a set of rules for the industry (Kim &
Advantage of this solution is lower
transaction costs, because Bitcoin can operate without a third-party
intermediary, merchants are able to avoid the expensive fees traditionally
charged by payment systems today such as credit cards.
On the other hand, disadvantage, severe
price volatility might occur as the value of a Bitcoin is determined by supply
and demand, and as a result, it can fluctuate rapidly.
The third solution is to tax
(Navaratnam & Holmes, 2017).
Advantage of this solution is: The government
can protect South Korean’s economic from inflation. Since Bitcoin’s circulation
is not linked to currency or government regulation, it is not subject to
disadvantage, tax avoidance and money laundering may occur (Ward,
2015) which the government will need to
regulate more regulations on those issues.
best solution to South Korean Bitcoin ban issue is to maintain light regulations and encourage a vast ecosystem of companies
and investors around digital assets by pioneering a set of rules for the
industry (Kim & Zaharia, 2018). Firstly,
this alternative will lower the trading outside the country. The money should
be flowed within South Korean, as the registration will push all traders to
trade across borders (Kim & Zaharia, 2018).
Secondly, South Korea can have a new cryptocurrency exchange by established
fintech firms so people can trade under government regulation on the South
Korean platform. It is a new way for citizens to generate income as well as
create more business from cryptocurrencies business (Rizzo, 2017). Thirdly, people
can always find the way to circumvent the restrictions (Kim &
Zaharia, 2018). The government can at least maintain
the cash flow with the right regulations and gradually encourage this new
ecosystem to all industries in South Korea.
conclusion, South Korea is now the world’s third-largest cryptocurrency
trading market (Orcutt, 2018). The government should take this advantage
to elevate the country’s income. The ban of cryptocurrency might do more harm
than good as people always search for a new way to build wealth. Therefore, it
is the government duty to come up with the right solution to have positive
effects on individuals, investors, and industries.