Journalist
Posted:
- The Korea Premium Index reached levels similar to when Bitcoin peaked in November 2021.
- Korean retail investors were willing to pay a premium to purchase Bitcoin.
Bitcoins [BTC] Demand in the US, the world’s largest financial center, surged manifold even as institutional investors in the country began placing their bets on the currency following the spot hype of exchange-traded funds (ETFs).
More than 6,400 miles (approx. 10,300 km) away, an Asian country had a similar appetite for Bitcoin, only this time it was driven by private investors.
Korean traders increase demand for Bitcoin
Bitcoin’s Korean Premium Index, a key barometer of the purchasing power of the South Korean market, rose dramatically in December.
According to AMBCrypto’s analysis of CryptoQuant, the index has reached levels similar to when Bitcoin peaked in November 2021.
Source: CryptoQuant
Korea Premium Index, also known as the Kimchi Premium, is the percentage difference between the market price of Korean exchanges and other exchanges.
For the uninitiated: the Korean The market is largely made up of private investors due to regulations against institutional investors.
This is a historical phenomenon and is caused by a high demand for cryptos in the country.
As was clear, the index was positive, implying that retail investors were willing to pay a premium for the purchase. Moreover, the rising trend indicated that more and more traders were willing to buy Bitcoins at a higher price.
Korean stock markets see a surge in Bitcoin trading
Over the past 24 hours, BTC was the third most traded asset on Upbit, the largest exchange in the country according to CoinGecko. Moreover, the BTC/KRW pair accounted for more than 7% of the exchange’s total trading volume.
On the other hand, the pair conquered a whopping 48% of the total volume on Bithumb, another major crypto trading platform in the East Asian country.
The indicator, according to a Cryptoquant researcher, provides important signals about price spikes. They attributed this to Koreans’ access to cash to buy coins on exchanges and FOMO hype.
Read Bitcoin’s [BTC] Price forecast 2023-24
While the current level was similar to Bitcoin’s peak, it remained to be seen if a correction is on the way or if Bitcoin would continue to rise.
At the time of writing, BTC was hovering in the $42,000 region, with losses of 1.33% in the past 24 hours, according to CoinMarketCap.