{"id":585,"date":"2024-10-18T03:00:18","date_gmt":"2024-10-18T03:00:18","guid":{"rendered":"https:\/\/bitcotasks.com\/blog\/bitcoin-trades-below-global-prices-in-south-korea-erasing-long-standing-kimchi-premium-heres-why\/"},"modified":"2024-10-18T03:00:18","modified_gmt":"2024-10-18T03:00:18","slug":"bitcoin-trades-below-global-prices-in-south-korea-erasing-long-standing-kimchi-premium-heres-why","status":"publish","type":"post","link":"https:\/\/bitcotasks.com\/blog\/bitcoin-trades-below-global-prices-in-south-korea-erasing-long-standing-kimchi-premium-heres-why\/","title":{"rendered":"Bitcoin Trades Below Global Prices In South Korea, Erasing Long-Standing \u2018Kimchi Premium\u2019 \u2013 Here\u2019s Why"},"content":{"rendered":"

Bitcoin (BTC) is trading slightly lower in South Korea compared to the global cryptocurrency markets due to a reverse \u2018kimchi premium,\u2019 not seen since October 2023.<\/p>\n

Reverse \u2018Kimchi Premium\u2019 Makes Bitcoin Cheaper In South Korea<\/h2>\n

According to a report<\/a> by The Korea Times, there is a price differential of more than $500 between Bitcoin’s price in South Korea and global markets. Analysts attribute this to a negative ‘kimchi premium.’<\/p>\n

For the uninitiated, kimchi premium refers to the price difference where BTC trades at a higher price on South Korean exchanges than on global markets. This premium is driven by local demand, regulatory factors, and capital controls in South Korea, leading to occasional price discrepancies.<\/p>\n

Currently, the kimchi premium stands at -0.74%, leading to a lower market price for BTC on South Korean exchanges than the rest of the world. Notably, the kimchi premium has been negative since October 15.<\/p>\n

A positive premium indicates strong demand for the underlying digital asset. In contrast, a negative premium might suggest that investors may be looking to trade on foreign exchanges due to South Korea\u2019s stringent regulations surrounding digital assets.<\/p>\n

A positive Kimchi Premium is common on South Korean exchanges, which often experience high trading volumes. When BTC briefly crossed $72,000 in March 2024, the kimchi premium surged as high as 10%.<\/p>\n

The report suggests low domestic investor sentiment is a key factor behind the negative premium.\u00a0While global crypto trading volumes have surged due to the upcoming US presidential elections and a Chinese stimulus package, sentiment in South Korea remains lukewarm. KP Jang, head of Xangle Research, commented:<\/p>\n

\n

Korea prohibits foreign and institutional investors from using domestic exchanges, which makes the decline in retail investor demand a more direct factor.<\/p>\n<\/blockquote>\n

Further, the preference for typically riskier altcoins in hopes of extraordinary profits might influence the local South Korean crypto market, driving attention away from BTC and leading to lower trading volumes.<\/p>\n

That said, analysts expect the negative kimchi premium to be a temporary phenomenon. Jang explained that, historically, such price discrepancies have only persisted for a short period.<\/p>\n

Will A Regulatory Overhaul Help South Korea?<\/h2>\n

The crypto regulatory framework in the peninsular country is witnessing several changes to streamline digital asset trading and ensure sufficient customer protection mechanisms are in place.<\/p>\n

In 2022, South Korea elected pro-crypto Yoon Suk-Yeol as president. As part of his election campaign, Yoon promised to reduce government interference in crypto markets, calling existing regulations \u201cfar from reality and absurd.\u201d<\/p>\n

In contrast, neighboring Japan has openly embraced digital assets amid evolving crypto regulations. For instance, earlier this year, Japan\u2019s Government Investment Pension Fund (GIPF), with $1.5 trillion in assets, expressed a desire to gain exposure to BTC.\u00a0<\/p>\n

BTC trades at $67,559 at press time, down 0.4% in the past 24 hours. When writing, the leading cryptocurrency commands a total market cap of $1.33 trillion.<\/p>\n

\"bitcoin\"<\/p>\n","protected":false},"excerpt":{"rendered":"

Bitcoin (BTC) is trading slightly lower in South Korea compared to the global cryptocurrency markets due to a reverse \u2018kimchi premium,\u2019 not seen since October 2023. Reverse \u2018Kimchi Premium\u2019 Makes Bitcoin Cheaper In South Korea According to a report by The Korea Times, there is a price differential of more than $500 between Bitcoin’s price…<\/p>\n","protected":false},"author":1,"featured_media":586,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[245],"tags":[65,111,73,71,19,639,254,255,640,641,642],"class_list":["post-585","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-bitcoin-news","tag-bitcoin","tag-bitcoin-news","tag-btc","tag-btcusdt","tag-crypto","tag-crypto-regulations","tag-cryptocurrency","tag-digital-asset","tag-japan","tag-kimchi-premium","tag-south-korea"],"_links":{"self":[{"href":"https:\/\/bitcotasks.com\/blog\/wp-json\/wp\/v2\/posts\/585","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitcotasks.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitcotasks.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bitcotasks.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/bitcotasks.com\/blog\/wp-json\/wp\/v2\/comments?post=585"}],"version-history":[{"count":0,"href":"https:\/\/bitcotasks.com\/blog\/wp-json\/wp\/v2\/posts\/585\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bitcotasks.com\/blog\/wp-json\/wp\/v2\/media\/586"}],"wp:attachment":[{"href":"https:\/\/bitcotasks.com\/blog\/wp-json\/wp\/v2\/media?parent=585"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitcotasks.com\/blog\/wp-json\/wp\/v2\/categories?post=585"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitcotasks.com\/blog\/wp-json\/wp\/v2\/tags?post=585"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}