The gap in crypto prices in South Korea, Kimchi Premium, is on discount which means cryptocurrencies such as Bitcoin are now cheaper to buy on South Korean exchanges. The Kimchi premium refers to when the price of Bitcoin trades higher on South Korean exchanges than in other markets.
According to data from blockchain analytics, CryptoQuant, the Korea Premium index has been shifting between the -0.24 and 0.01 range. As per Doo Wan Nam, COO of node validator and venture capital fund Stablenode, the Kimchi premium changing to a discount marks a drop in interest from Korean retail investors.
“Generally it means fall in interest in crypto from Korean retail, which ironically is generally a better time to buy cause you know you can always sell yours to Korean gamblers for 20% premium later when they FOMO,” he said.
The amount of the Kimchi premium has historically been correlated with news, with large drops being observed whenever negative news regarding South Korean cryptocurrency exchanges is reported.
As the South Korean government declared it would crack down on bitcoin trade at the start of 2018, the premium vanished. According to research published in 2019 by the University of Calgary, the Kimchi Premium first appeared in 2016.
Subscribe to The Crypto Times for more crypto news!!
