On Sunday (March 4), Ki Young Ju, the CEO of South Korean blockchain analytics startup CryptoQuant, talked about the increasing “Kimchi premium” and why this does not mean that the Bitcoin price is about to crash.
The Kimchi premium exists when the BTC price gap (%) between South Korean crypto exchanges and other crypto exchanges is positive.
Earlier today, Larry Cermak, Director of Research at The Block, pointed out that Kimchi premium had reached 16%, which means that at the time of his tweet (07:43 UTC on April 5), the BTC price on South Korean exchange Bithumb was around $66,300.
Meanwhile, over on European exchange Bitstamp, the BTC price was around $57,268.
The CryptoQuant CEO said yesterday that although he was worried by the “Korean bubble”, Bitcoin still enjoys solid fundamentals.
He wrnt on to say if this bubble bursts, it should not have a “significant” effect on the price of Bitcoin outside of South Korea since Bitcoin’s total 24-hour trading volume across South Korean exchanges is only around 1.7% of Bitcoin’s total 24-hour trading volume across the world.
He went on to say:
“Remember when the $BTC market collapsed with a 50% kimchi premium back in 2018? Don’t worry. Simply calculating the trading volume, the Korean market had 7.9% of the influence as of 2018 January, while today it is only 1.7%.“
Meanwhile the CIO and CEO of Singapore-based crypto-focused hedge fund Three Arrows Capital finds this “reawakening of Korean demand for cryptoassets” bullish for the crypto markets.
According to data by CryptoCompare, currently (as of 11:09 UTC on April 5), Bitcoin is trading around $57,633, up 0.63% in the past 24-hour period. In the year-to-date period, the Bitcoin price is up 98.92% vs USD.
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