Bitcoin reeling amid renewed cryptocurrency crackdown

Cryptocurrency prices slid on Tuesday, after South Korea said shutting down exchanges is still an option.

According to Coinbase, bitcoin was trading around $12,287 Tuesday morning. Bitcoin started to sell-off mid-day Monday, falling from a peak of $14,079. Bitcoin has shed almost 38% of its value in the last month.

Last week, there were reports that South Korea’s government was planning to ban cryptocurrency trading, but after bitcoin slid, the government backtracked.

On Jan. 1, Reuters reported that South Korea’s Justice Minister Park Sang-ki said the government was preparing a bill to ban trading of the virtual currency on domestic exchanges.

"There are great concerns regarding virtual currencies and the justice ministry is basically preparing a bill to ban cryptocurrency trading through exchanges," Park told a news conference.

But, after bitcoin collapsed, a few hours later, South Korea’s presidential office said a ban on the country's virtual coin exchanges had not yet been finalized.

Fast forward to Tuesday, and South Korea's top financial policymaker said a crackdown on trading of cryptocurrencies was still possible.

In an interview with local South Korean radio station TBS, Finance Minister Kim Dong said that banning trading in digital currencies was "a live option," and that the decision was subject to a thorough government review.

While the government is still considering a ban, 210,000 South Koreans have signed an online petition on the presidential office’s website asking the government not to ban trading digital currencies.

"We the citizens were able to have a happy dream that we had never had in South Korea thanks to crypto currency," the petition reads. "You may think you are protecting the public but we citizens think that the government is stealing our dream."

China is apparently accelerating its clampdown on cryptocurrency trading, Bloomberg reported.

The Associated Press contributed to this report