Bitcoin ‘Kimchi Premium’ in South Korea goes on sale
South Korea’s “Kimchi Premium” — a metric that shows the crypto’s price difference on global exchanges and such in the Asian nation — entered discount territory for the first time since January 18.
This indicates that buying digital assets, such as bitcoin, is cheaper on Korean platforms than on Binance or other leading players, which usually means that the interest of local users has declined.
Turn to discount
“Kimchi Premium” – a phenomenon that bears the name of a traditional Korean meal – turned into a discount, showing a difference in the valuation of the primary cryptocurrency on local and global trading venues.
One bitcoin is currently trading at around $24,655 Bithumb and $24,650 on Korbitwhile the price is $24,800 on Binance and $24,850 on Coin base. The number is also lower Upset ($24,700) and Coinone ($24,648).
The analysis platform CryptoQuant showed the fluctuations in the calculation in the last month. During most days, the price of BTC was relatively higher on Korean platforms than on those based outside the East Asian country, which usually indicates increased interest in the asset from local investors.
Taking a look at the graphic representing the last few years, one could notice that “Kimchi Premium” was at a discount towards the end of 2020 and the beginning of 2021 (when BTC was on a bull run). The metric entered similar territory in November 2022 (when the entire cryptocurrency market shook due to FTX’s demise).
Binance’s return to South Korea
Reports recently surfaced that the world’s largest cryptocurrency exchange wanted to buy a 41.2% stake in one of the leading digital asset platforms in South Korea – Gopax – to re-enter the local market. The latter stopped operations in November due to unfavorable macroeconomic conditions.
Binance reportedly completed the deal nearly two weeks ago, using funds from its $1 billion Industry Recovery Initiative. CEO Changpeng Zhao (CZ) believes the exchange’s return to the region could “rebuild the Korean crypto and blockchain industry.”
Yibo Ling – Chief Business Officer of Binance – outlined that the primary goal of the deal was to form a “fundamental drive” among domestic consumers and “ensure that all customers who want to withdraw their assets have the ability to do so.”
