What is the Kimchi Premium? — Why the Same Bitcoin Costs More in Korea

In One Sentence

The Kimchi Premium is a percentage value showing how much more expensive a cryptocurrency is on Korean exchanges compared to global exchanges. A positive value means Korean prices are higher (Kimchi Premium), while a negative value means Korean prices are lower (Reverse Premium).

How It Is Calculated

We convert the Korean Won (KRW) price into US Dollars (USD) using the current exchange rate, and then compare it to the global USD price.

(Korean Price in KRW ÷ KRW/USD Exchange Rate) ÷ Global Price in USD − 1

For example, as of 24 Aug our measurement was -1.19% — Korea is cheaper = domestic buying is not following the move. At that moment tether (USDT) was ₩1,368 and the reference rate was ₩1,384.51.

Why It Happens

On Korean exchanges, you can only buy crypto with Korean Won, and money cannot flow freely in and out of the country. When buying demand surges in Korea, local prices shoot up. Because capital cannot move quickly to bridge this gap, the price difference persists.

This is why the Kimchi Premium is often used as a thermometer for local investment sentiment. A rising premium means strong buying pressure in Korea, while a negative premium indicates that the local market has cooled down.

How Exchange Rates Shake Up the Premium (A Common Point of Confusion)

Because the exchange rate is part of the formula, the Kimchi Premium can change even if crypto prices stay exactly the same.

• If the exchange rate rises (Won weakens) → The Korean price becomes smaller when converted to USD → The Kimchi Premium drops
• If the exchange rate falls → The Kimchi Premium rises

When you see that "the premium has dropped," you need to distinguish whether local buying interest has cooled down or if the exchange rate has simply shifted.

Can't I Just Buy Low and Sell High?

In theory, yes. In reality, you will run into the following hurdles:

• Transfer Time — Moving crypto from a global exchange to a Korean exchange takes anywhere from a few minutes to dozens of minutes. It is common for the price gap to disappear during this time.
• Fees — Trading fees, withdrawal (transfer) fees, and currency exchange costs will eat into your potential profits.
• Deposit and Withdrawal Restrictions — Exchanges sometimes block deposits or withdrawals for specific cryptocurrencies.
• Foreign Exchange Regulations — Sending Korean Won abroad is heavily restricted and not freely allowed.

Therefore, we look at the Kimchi Premium not as an arbitrage opportunity, but as a metric to read the market temperature.

We Track It for You Every Week

Antprofit compares three major Korean exchanges with global exchanges at the exact same time, measuring the Kimchi Premium every 10 minutes. Every Monday, we summarize the weekly trend. Since the premium varies by coin, we also look at "which specific coin is currently trading at the highest premium in Korea."