The so-called Kimchi Premium in South Korea reached a 27-month high of 10.32% for bitcoin on Wednesday in Asia, according to data from CryptoQuant.
Kimchi Premium is a term that refers to the price difference between crypto tokens in South Korea and elsewhere. CryptoQuant’s data compares South Korea’s bitcoin price with that of the USD market.
The crypto prices in South Korea differ from those outside the country due to several unique elements of the country’s crypto market. Local rules essentially block foreign investors from trading on South Korean exchanges. Korean investors who purchase large sums of crypto from foreign exchanges for arbitrage may be punished under the country’s Foreign Exchange Transactions Act.
With the limited supply of crypto domestically, surging local demand often leads to a bigger gap in prices. The rise in the premium may indicate stronger buying pressure from South Korea’s retail investors, CryptoQuant data shows.
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broke its previous all-time high price on Tuesday in the U.S., surpassing the $69,000 mark. On South Korea’s Upbit exchange, bitcoin surged past 97 million Korean won ($72,926), according to a local news report.
Bitcoin has since retraced a part of its gains and is trading around $65,800 on Thursday afternoon in Asia, according to The Block’s price page.
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About Author
Danny Park is an East Asia reporter at The Block writing on topics including Web3 developments and crypto regulations in the region. He was formerly a reporter at Forkast.News, where he actively covered the downfall of Terra-Luna and FTX. Based in Seoul, Danny has previously produced written and video content for media companies in Korea, Hong Kong and China. He holds a Bachelor of Journalism and Business Marketing from the University of Hong Kong.