Decentralized system like cryptocurrencies means that no one have authority and control of it, this is the fact why are counties afraid of cryptocurrencies, because cryptocurrencies are threat to traditional financial system, some official stated that cryptocurrencies could be banned entirely or at the very least it would be regulated.
South Korea is not the first country that have banned cryptocurrencies. Last year country like Vietnam, China, Bolivia, Ecuador, Kyrgyzstan, Saudi Arabia, Bangladesh and North Korea also banned trading cryptocurrencies. There are few reason why counties are banning cryptocurrencies, just like above mentioned. As we already said, cryptocurrencies have being banned for security issues. The other reason is it decentralization which means that people are trading with the cryptocurrencies without the third party (intermediate) which traditionally is a bank.Security and protection
The fact that cryptocurrencies are anonymous nature means that cryptocurrencies could be used for illegal transaction, for example police in South Korea find out that the two of the country\'s largest cryptocurrency exchange are avoiding taxes. Also cryptocurrencies could be used for money laundering or terrorism.Banks and governments
As you probably know, bank will charge you fees for doing absolutely anything that includes money like transaction, deposit, even when they just hold your money. After the financial crisis in 2008 the trust in bank is decreasing. Using blockchain technology where every single transaction is securely linked together which is making transaction verifiable is more immune to attack than traditional banks. As we already said no one have control of cryptocurrencies which means that the monitoring of transaction is almost impossible, this is for example reason why China banned cryptocurrencies. Also, cryptocurrencies are threat to the stability of the nation currency for example Indonesia.