Bitcoin’s Kimchi Premium: A 3-Year High Explained

South Korea’s Bitcoin market is showing a strange trend. The “Kimchi Premium,” the difference between Bitcoin’s price in South Korea and the global price, just hit a three-year high of 12%! This is unusual, and it’s not what you’d expect.

What’s the Kimchi Premium?

Usually, a high Kimchi Premium means South Koreans are buying a lot of Bitcoin, driving up the price locally. But this time, it’s different.

Why the Unexpected Spike?

According to CryptoQuant CEO Ki Young Ju, this isn’t about increased Korean Bitcoin buying. Instead, it seems Koreans are trading their Bitcoin for US dollars. Why? The looming US tariffs on Canada, Mexico, and China are creating economic uncertainty. The US dollar is seen as a safer bet during times like these.

The Bigger Picture: Global Market Uncertainty

The crypto market is down overall, with a significant drop in total value. This is largely due to worries about the impact of these potential tariffs. Over $2 billion in crypto assets were liquidated in the last 24 hours – that’s a huge amount! This surpasses the liquidations seen during major crashes like the 2020 COVID crash and the FTX collapse.

What Happens Next?

The situation is still uncertain. Talks between the US and Canada might lead to the tariffs being delayed or even cancelled. If that happens, the crypto market could recover some of its losses.

However, for Bitcoin to really bounce back and hit new highs, it needs to break past the $105,000 mark. Some experts think it might even need to dip down to around $76,000 before it starts climbing again. As of now, Bitcoin is trading around $96,864.