High Korean Bitcoin Premium Signals Strong Retail Investor Activity: CryptoQuant

CryptoQuant's latest analysis suggests an interesting trend in the crypto market, especially the Korean premium overheating.

The high price of the Korean premium was interpreted by the chain intelligence firm as an indication of strong buying pressure from Korean retail investors.

While a high Korean premium can be interpreted as a sign of bullish sentiment, this index is also frequently used to identify potential price peaks.

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Overheated Korean Bitcoin market

The Korea Premium Index (KPI) is of great importance as a key indicator for tracking changes in the cryptocurrency landscape. This index measures the ‘kimchi premium' and provides valuable insights into market sentiment in South Korea, a particularly active player in global cryptocurrency markets.

A higher KPI increase in buying pressure indicates higher buying pressure on South Korean exchanges compared to international platforms. On the other hand, a low KPI reflects low market sentiment, reducing buying pressure and allowing for increased selling activity.

However, it is important to understand that the Korea Premium Index is also used to identify price peaks. CryptoQuant outlines that this is done with the help of two key factors: immediate access to funds for coin purchases on Korean exchanges and the prospect of fear of missing out (FOMO) in the market.

In particular, the current 14-day moving average of the Korea Premium Index in It shows the levels observed during the peak of the Bitcoin price cycle in the fourth quarter of 2021. .

“We are very excited to see if the Korea Premium Index will provide significant clues to prices at this time.”

South Korean traders were bullish.

South Korea was one of the most important contributors to the unexpected surge in the digital asset market at the end of the year. In November alone, their market share rose to 13 percent, a significant increase from the 5.2 percent recorded in early January.

Chung Hochan, head of marketing at CryptoQuant, said it is notable for the lack of a futures market that caters to retail investors in South Korea. This absence has prompted retail investors in the country to actively explore significant leverage opportunities in the crypto market, particularly with a focus on altcoins.

The high demand and participation in altcoins, the lack of future trading options, has played a key role in the remarkable expansion of the altcoin market, which distinguishes it from other traditional investment assets.