The “kimchi bonus” is back. Bitcoin (BTC) is trading 6 percent higher on South Korea’s major cryptocurrency exchanges as of March 29.
According to CryptoQuant data, this premium has not been seen in the South Korean market for several months, even falling to around -6 percent in early February, with BTC falling below $ 30,000.
The kimchi premium occurs when Bitcoin trades higher on South Korean exchanges compared to other markets.
The return of this premium is seen as a positive sign as it indicates that demand for Bitcoin in South Korea has exceeded supply.
Why is the kimchi bonus important for Bitcoin?
While South Korea does not have the vast majority of the global Bitcoin market, it remains one of the largest stock markets in terms of daily volume.
For example, Bithumb is ranked as the seventh largest stock exchange in the world in terms of daily trading volume in CoinMarketCap’s stock market listing. In Bithumb, $ 1.3 billion worth of Bitcoin was traded in the last 24 hours.
The kimchi premium was particularly high in previous bull cycles. For example, in 2017, BTC traded 20 percent higher on South Korean exchanges compared to Coinbase and other major exchanges.
The kimchi premium shows two major trends. First, it shows that overall market sentiment in South Korea is healthy. The second indicates that more buyers are entering the market.
Market sentiment in Korea is not bad. $ BTC sellers are not Koreans obviously. https://t.co/4UIneKZKuu
– Ki Young Ju 주기영 (@ki_young_ju) March 25, 2021
The premium has been rising over the past few weeks. After Visa announced that it would support payments with USD Coin, both Bitcoin and Ether (ETH) rose 5 percent, triggering a strong rebound in the market.
This announcement could further accelerate corporate penetration and trigger Bitcoin’s wider rally.
What awaits the investors next?
The anonymous investor known as “Rekt Capital” says that if Bitcoin breaks $ 59K, new record levels are likely to be seen. Said it was extremely high.
Another investor, “CryptoCapo”, is that the new bullish momentum can carry Bitcoin up to $ 80,000. Put forward:
“The panic was so unreasonable. Some people want to see the world burn … going towards $ 80,000.”