When South Korean gold prices soar, Bitcoin’s $5K “Kimchi Premium” returns

Bitcoin (Bitcoin) The transaction price in South Korea on Wednesday was $5,000 higher than in other markets because of the continued implementation of the “Kimchi Premium” in capital flow controls. At the time of publication, Bitcoin was trading at $39,932 on Coinbase, while its price on the Bithumb exchange in South Korea was $45,115.

According to a recent statement by the Bank of America, the kimchi premium is the result of capital flow controls aimed at preventing the cross-border transfer of “hot money”. report Reuters

“The onshore price of Korean cryptocurrency has always been higher than the international price, which shows that this is the result of effective capital controls and prevents effective arbitrage of onshore and offshore prices. Korean capital controls have allowed the “kimchi premium” to continue.” The bank said in a report on Tuesday.

Although the coin has recently fallen by 32%, and there are signs that South Korea’s Bitcoin premium remains at 12.5% Increase transfer Conduct centralized communication. The Bank of America report pointed out that in the first quarter of 2021, South Korea’s daily cryptocurrency trading volume reached a new height, exceeding 1,480 trillion won (1.3 trillion US dollars).

Although South Korea’s demand for cryptocurrencies continues, so does the demand for gold. As of Tuesday, May 18, the price of gold rose for four consecutive days, setting its highest level since January.

The current price per gram is 68,200 won (US$60.36), which is a 9.4% increase from two months ago. The Korea Herald determine Expressed that concerns about inflation have intensified. Although Koreans are still far below historical levels, Inflation rate It rose by 1.5% in April alone. Since 2019, the inflation rate has climbed from below zero to 2.3%.