Capital from South Korean retail investors is driving the price momentum of Ether and the emergence of corporate Ether treasury firms, industry insiders report, as the second-largest cryptocurrency trades just 7% below its all-time high.
The only factor sustaining the Ether (ETH) price and Ether treasury firms at current levels is approximately $6 billion in Korean retail capital, stated Samson Mow, CEO of Bitcoin technology company Jan3.
“ETH influencers have been traveling to South Korea specifically to market to retail investors. These individuals have little understanding of the ETHBTC chart and believe they’re investing in the next strategic play,” Mow noted in a Monday X post, cautioning that this situation may not conclude positively.
Upbit and Bithumb are the primary centralized exchanges (CEXs) utilized by South Korean retail traders.
According to CoinGlass data, Upbit ranked as the 10th largest CEX in terms of Ether futures trading, with a trading volume of $1.29 billion over the past week.
Typically, crypto futures trading surpasses spot trading volume, thereby exerting more influence on the underlying asset’s price.
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Ether’s “Kimchi premium” indicates increased engagement from Korean retail investors
The “Kimchi premium” for Ether, representing a higher price of the cryptocurrency on South Korean exchanges compared to others, also reflects rising demand from Korean retail investors.
Ether’s Kimchi premium reached 1.93 on Sunday, climbing from -2.06 on July 16, when Ether was trading below $2,959, according to blockchain data platform CryptoQuant.
This metric gauges the price discrepancy for Ether between South Korean exchanges and others.
Korean retail investors play a significant role in the crypto market, as evidenced by Ether’s kimchi premium, according to Marcin Kazmierczak, co-founder of blockchain oracle firm RedStone.
Nonetheless, Kazmierczak remarked that this only represents a small portion of Ether’s overall momentum.
“Describing them as the main support for Ethereum undervalues the network’s diverse global capital base, which features considerable US institutional investment through ETFs, corporate treasuries, and the extensive DeFi ecosystem that depends on ETH.”
Kazmierczak further noted that Ethereum’s strength is rooted in its “borderless nature,” which merges Korean retail and global institutional participation.
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Mow’s observations come as many industry experts are questioning the sustainability of Ether treasury firms.
In September, Mechanism Capital founder Andrew Kang criticized BitMine founder Tom Lee’s Ether thesis, claiming it exaggerated Ether’s value derived from stablecoins and real-world asset (RWA) tokenization.
“The valuation of Ethereum mainly stems from financial illiteracy, which, admittedly, can establish a reasonably large market cap,” Kang stated in a Sept. 24 X post, adding that “the valuation induced by financial illiteracy is not infinite.”
While “broader macro liquidity” has sustained Ether’s price momentum, it will require “significant organizational change” to prevent “indefinite underperformance,” Kang asserted.
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