The Bank of America published a report on May 18, notifying that in South Korea the cryptocurrencies get a tremendous premium on international prices because of the capital flow controls.
On May 18, Bitstamp Exchange data showed that the world’s largest cryptocurrency Bitcoin is being traded at $45,219, but Coinmarketcap.com data did not match with it. In fact, it revealed that in South Korea Bitcoin was being traded at a $4000 higher price. In January 2018, the premium reached near $8000.
As per the report by Bank of America, “The onshore price for cryptocurrencies in Korea is persistently above international prices suggesting this to be a result of effective capital control that prevents effective arbitrage of onshore and offshore prices.”
Further, it stated that the capital control of Korea helps the Kimchi premium to carry on its process.
The annual market cap of foreign currency in Korea is 50,000, presently.
In first quarter of 2021, the estimated daily volume of crypto trading reached $1.31 trillion, in South Korea. At times, the daily trading volume helps in increasing the combined trading volume on the KOSPI and KOSDAQ share markets.