Capital from retail investors in South Korea is driving Ether’s price movements and the growth of corporate Ether treasury firms, industry insiders reveal, as the second-largest cryptocurrency trades only 7% below its highest price ever.
According to Samson Mow, CEO of Bitcoin technology firm Jan3, approximately $6 billion in Korean retail investment is all that sustains current Ether (ETH) prices and treasury companies.
“ETH influencers have been traveling to South Korea to target retail marketers. These investors are largely unaware of the ETHBTC chart and believe they’re making the next big play,” Mow stated in a post on X on Monday, cautioning that the situation “won’t end well.”
South Korean retail traders predominantly utilize Upbit and Bithumb, the two main centralized exchanges (CEXs).
In terms of Ether futures trading, Upbit ranks as the 10th largest CEX with a trading volume of $1.29 billion over the past week, according to CoinGlass data.
Typically, crypto futures trading surpasses spot trading in volume, thus exerting a greater influence on the asset’s price.
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Ether’s “Kimchi premium” indicates heightened interest from Korean retail investors
The “Kimchi premium” associated with Ether, where the price on South Korean exchanges exceeds that on others, reflects rising demand among Korean retail investors.
Recently, Ether’s Kimchi premium reached 1.93 on Sunday, a significant increase from -2.06 on July 16, when Ether was valued below $2,959, according to blockchain data platform CryptoQuant.
This indicator gauges the price disparity of Ether between South Korean exchanges and others.
Marcin Kazmierczak, co-founder of blockchain oracle firm RedStone, noted that Korean retail investors play a crucial role in the crypto market, as evidenced by Ether’s Kimchi premium.
However, Kazmierczak emphasized that this represents just a small portion of Ether’s overall drive.
“Identifying them as the main support for Ethereum significantly undermines the network’s diverse global capital landscape, which includes significant US institutional investments through ETFs, corporate treasuries, and the expansive DeFi ecosystem that relies on ETH.”
He added that Ethereum’s resilience stems from its “borderless nature,” integrating both Korean retail and global institutional participation.
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Mow’s observations come amid skepticism from others in the industry regarding the longevity of Ether treasury firms.
In September, Mechanism Capital founder Andrew Kang critiqued BitMine founder Tom Lee’s views on Ether, arguing that they exaggerated the value Ether derives from stablecoins and real-world asset (RWA) tokenization.
“Ethereum’s valuation is largely based on financial misunderstanding, which, while substantial, does not guarantee an infinite market cap,” Kang noted in a Sept. 24 post on X, stating that “the valuation based on financial illiteracy is not limitless.”
While “wider macro liquidity” has upheld Ether’s price movement, it necessitates “significant organizational changes” to avoid “prolonged underperformance,” Kang concluded.
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