South Korea has seen a resurgence of cryptocurrency trading due to rising bitcoin (BTC) values; this week, volumes on local exchanges surpassed those of the local stock market.
TakeAway Points:
- Crypto exchanges in Korea reported a trade volume of 12 trillion won on Sunday, above the 11.47 trillion won total from the stock market on Friday.
- Alternative investments are becoming more and more popular among Koreans, with cryptocurrencies being favoured over more significant assets like ETH or BTC.
- The sum of the transaction values of the top five won marketplaces in Korea are as follows: Upbit (8.8 trillion won), Bithumb (2.7 trillion won), Coinone (176.4 billion won), Gopax (55.2 billion won), and Coinone (32 billion won…).
Bitcoin Surges Over $8.7billion in South Korea
According to CoinMarketCap, a global virtual asset market relay site, on Sunday, as of 12 noon on this day, the 24-hour trading volume of domestic virtual assets was KRW 11.8543 trillion.
At the current USD-KRW exchange rate, that translates to $9 billion. These exceeded the 11.47 trillion won, or $8.7 billion, trading volume of South Korean stocks on Friday.
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However, according to the report, the sum of the transaction values of the top five won marketplaces in Korea are as follows: Upbit (8.8 trillion won), Bithumb (2.7 trillion won), Coinone (176.4 billion won), Gopax (55.2 billion won), and Coinone (32 billion won…).
Bitcoin (BTC), space id (ID), IQ Protocol’s IQ, 0x’s ZRX, and shiba inu (SHIB) were the top five cryptocurrency markets on Upbit.
According to local market observers, Korean investors’ risk tolerance increased when the cryptocurrency market saw a comparatively larger volume.
“Koreans favor high-risk, high-return investments because they experienced a rapidly growing economy. With the increasing wealth gap, more people are turning to such investments, with altcoins being the preferred choice over major assets like BTC or ETH.”
Ki Young-Ju, founder of on-chain provider CryptoQuant, shared in a message.
According to the report, the huge volumes are indicative of robust retail demand even if bitcoin, ether, and other tokens trade on Korean exchanges at a greater markup than on their international counterparts.
Bradley Park, head of research at CryptoQuant, pointed out that “the kimchi premium is at its highest since the Luna crash in May 2022. It is often seen as a sign of strong retail demand, as Korean investors are willing to pay a premium for Bitcoin.”
“Upbit’s daily trading volume has remained high since March after reaching 60K. It further supports the evidence of retail inflow,”
Park added.
In addition, the term “Kimchi premium” describes the discrepancy between the price of Bitcoin on Korean exchanges and international markets. With bitcoin trading at a 10% premium in South Korea, there is now a lucrative but technically challenging arbitrage opportunity to acquire bitcoin on a foreign exchange and sell it on a Korean exchange for a guaranteed profit in Korean won.
