South Korean Investors Fuel Bitcoin Surge with Kimchi Premium Return
Bitcoin's price has surged over the past week, rising from around $62,000 to over $81,000. This significant increase has led to a return of the 'Kimchi premium,' a key indicator of the cryptocurrency market in South Korea.
The Kimchi premium refers to the difference between the price of Bitcoin traded in South Korea and its global market price. According to Bloomberg, as of September 1, the price of Bitcoin in Korean won on Upbit was trading approximately 1% higher than the dollar-based price of Bitcoin on Binance.
This development is considered a signal for Bitcoin's price recovery. Analyst Rachael Lucas from BTC Markets stated that South Korean individual investors tend to aggressively increase their Bitcoin purchases during periods of increased risk appetite.
However, not everyone is convinced that this signals a new rally. Markus Thielen, head of 10x Research, notes that while the premium has turned positive, spot trading volumes haven't increased to the same extent.