Bitcoin (BTC) Price Recovers and Surpasses $66,000
After a brief pullback to $60,000 on Wednesday, the world’s largest cryptocurrency Bitcoin (BTC) has experienced a healthy recovery. In the last 24 hours, the Bitcoin price has increased by 4% and has once again surpassed the $66,000 mark.
Bitcoin (BTC) Kimchi Premium Reaches 10%
CryptoQuant CEO Ki Young Ju recently announced that Bitcoin’s price premium in South Korea has reached an impressive 10%, its highest level in two years. This increase in premium indicates a renewed interest and confidence among local traders, particularly Korean retail investors.
The Kimchi premium refers to the difference in cryptocurrency asset prices between South Korean exchanges and those abroad. This premium has been steadily increasing alongside the BTC price since February.
According to on-chain data from CryptoQuant, the Korea Premium index rose from 5.19 on February 28 to 6.84 on March 5. This increase coincided with Bitcoin reaching a new all-time high of over $69,200 on March 5. It is believed that ongoing investments in Bitcoin ETFs in the United States have contributed to this surge.
In contrast to the US, South Korea does not yet have Bitcoin ETFs that attract strong institutional participation. As a result, retail spot buying has been driving up prices on Korean exchanges.
During BTC’s bullish surge in December 2017, South Korean exchanges were trading Bitcoin at nearly 50% higher prices compared to most global exchanges. CoinMarketCap had to delist some Korean exchanges at that time due to significant price disparity from the global average.
The Kimchi premium reached its peak at 21.56% on May 19 during the 2021 bull run. This coincided with Bitcoin’s price surpassing $36,000 before eventually reaching its previous all-time high in November 2021.
South Korea Considers Approving Bitcoin Spot ETFs
South Korea, known for its tech-savvy population, is currently exploring the possibility of approving Bitcoin Spot ETFs. Lee Bok-hyun, the governor of the Financial Supervisory Service, mentioned in a recent radio interview that authorities are discussing the legalization of Bitcoin Spot ETFs in the country.
However, the classification of BTC as an underlying asset remains a significant concern for South Korean regulators. While financial authorities stated in January that they have no plans to regulate Bitcoin ETFs, questions have arisen regarding the sale of spot Bitcoin ETFs by brokerages under the Capital Markets Act.
If approved, Bitcoin Spot ETFs would provide a regulated and accessible way for South Korean investors to gain exposure to Bitcoin without directly owning it. This move could potentially attract more institutional investors and further drive up the price of Bitcoin in the country.
Hot Take: Bitcoin’s Resilience and Growing Interest
Bitcoin has once again demonstrated its resilience by recovering from a brief pullback and surpassing $66,000. The cryptocurrency’s price surge has also led to an increase in the Kimchi premium in South Korea, indicating renewed interest and confidence among local traders.
The potential approval of Bitcoin Spot ETFs in South Korea adds another layer of excitement to the market. If authorized, these ETFs would provide a regulated investment vehicle for investors looking to gain exposure to Bitcoin without directly owning it.
The growing interest in Bitcoin and cryptocurrencies is evident not only in South Korea but also globally. Institutional investors are increasingly entering the market, and governments are exploring regulations to accommodate this growing demand.
As the cryptocurrency market continues to evolve, it is crucial for investors to stay informed and make educated decisions. Understanding the factors that drive Bitcoin’s price, such as the Kimchi premium, can help investors navigate this volatile market and seize potential opportunities.
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