South Korea’s top financial regulator recently told 23 other countries’ regulators that the kimchi premium has fizzled since the anonymous trading of cryptocurrencies was banned in the country. Now, the government is introducing a new guideline to prevent local crypto exchanges from buying cryptocurrencies at foreign exchanges.
Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space
Kimchi Premium Disappearing
Kim Yong-beom, the vice chairman of South Korea’s top financial regulator, the Financial Services Commission (FSC), attended a meeting of the Financial Stability Board (FSB) in Basel, Switzerland, earlier this week.
The FSB is an international body that monitors and makes recommendations about the global financial system. Its members are financial regulators and central bankers from 24 countries as well as the International Monetary Fund, the Bank of International Settlements, the World Bank, the European Central Bank, and the European Commission.
According to the FSC’s statement issued this week, Kim told other world regulators that “The so-called kimchi premium stood at 0.6 percent on June 19,” Yonhap described. In comparison, he noted that “On Jan. 7, a speculative rally in bitcoin in South Korea prompted investors to pay premiums of 46.7 percent compared with international prices.” The vice chairman was further quoted by the news outlet:
Currently, there are small price gaps in cryptocurrency between local and international markets.
At the time of this writing, the price of BTC on Bitfinex is $5,875 while its won price on Bithumb equates to $5,947.
Government Believes Real-Name System is Working
The South Korean government introduced the real-name system for cryptocurrency accounts at the end of January, effectively “banning the use of anonymous bank accounts in transactions to prevent virtual coins from being used for money laundering and other illegal activities,” the
