Bitcoin’s ‘Kimchi Premium’ Turns Negative as South Korean Prices Fall Below Overseas Markets
Summary
- Bitcoin and Ether have traded at a persistent, prolonged reverse kimchi premium this year, leaving domestic prices below those in overseas markets.
- Of the 221 days so far this year, 123 fell into Bitcoin’s reverse kimchi premium range, and the market set consecutive records, including a 35-day streak of negative premium.
- Researcher Park Sung-je said weaker domestic digital asset investment sentiment, the absence of derivatives, and the pending rollout of cryptocurrency taxation are reducing the market’s appeal.
Forecast Trend Report by Period
A so-called reverse kimchi premium, where digital assets trade at lower prices in South Korea than abroad, has become a clear and persistent trend this year.
The traditional kimchi premium — in which cryptocurrencies trade at higher prices domestically than on overseas exchanges — has not only disappeared but given way to a prolonged discount.
Bitcoin’s kimchi premium gauge remained negative every day through Aug. 9 this month, according to data compiled by on-chain analytics platform CryptoQuant and cited on Aug. 11. The average reading was minus 0.48.
The indicator measures the percentage price gap between South Korea’s five largest won-denominated exchanges — Upbit, Bithumb, Coinone, Korbit and Gopax — and overseas exchanges. That means Bitcoin traded 0.48% cheaper on domestic exchanges than on foreign platforms on average.
The kimchi premium gauge for Ether, the second-largest cryptocurrency by market value, also stayed negative throughout the month, averaging minus 0.49.
A reverse kimchi premium is no longer unusual. Of the 221 days so far this year, Bitcoin posted a reverse kimchi premium on 123 days, nearly a month more than the number of days it traded at a positive premium.
This is the first year in which the reverse kimchi premium has lasted longer than the regular premium on an annual basis since CryptoQuant began providing the data in July 2020.
The longest stretch on record was also broken recently. Bitcoin posted a reverse kimchi premium for 35 straight days from June 20 to July 24 this year.
The previous record was 23 days, from July 8 to July 30, 2025. That mark was first broken by a 30-day run from May 20 to June 18 this year, and then surpassed again.
A kimchi premium tends to form when enthusiasm among South Korean crypto investors runs hotter than overseas demand.
For years, stronger domestic investor appetite kept cryptocurrency prices unusually high in South Korea. More recently, they have turned cheaper instead.
A sharp rally in the local stock market drew many retail investors away. At the same time, a slump in the crypto market and a range of regulations prevented even new services from being introduced, dampening investor interest.
Park Sung-je, a researcher at Shinhan Securities, said new inflows have been limited because a broad range of crypto-based derivatives has not been introduced in South Korea. With cryptocurrency taxation also approaching, the market’s investment appeal is not high, he added.
Park Geun-a, Hankyung TV reporter twilight1093@hankyungtv.com
Korea Economic Daily
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