Bitcoin News Today: Circuit Boards Replace Blockchains as South Korea's Speculative Engine

Bitcoin trades with a 1.75% Kimchi Premium in South Korea on November 11, as the country's crypto market continues to cool amid a dramatic shift in retail investor focus to equities.

The premium, a longstanding phenomenon where Korean exchanges trade Bitcoin at a discount to global prices, has narrowed amid declining trading volumes and a broader reallocation of speculative capital, as detailed in The Great Korean Pivot: From Memecoins to Machine Chips.

South Korea's crypto exchanges have seen a sharp drop in activity since late 2024. Upbit, the nation's largest exchange, now processes daily volumes of roughly $1.8 billion, down from $9 billion a year earlier, while Bithumb, the second-largest, has lost over two-thirds of its liquidity. The decline has been compounded by a collapse in volatility, with trading bands flattening to a $2 billion to $4 billion range compared to swings of $5 billion to $27 billion in 2024. Data from analytics firm Dune shows active trading accounts on Korean exchanges have plummeted from 280,000 daily deposits at the height of the 2018 crypto boom to under 50,000 since 2021, as detailed in The Great Korean Pivot: From Memecoins to Machine Chips.

The vacuum left by crypto has been filled by a frenzy in the Korean stock market, where the KOSPI index has surged 70% year-to-date. AI-linked giants like Samsung Electronics and SK hynix have driven much of the rally, accounting for over a quarter of the exchange's daily turnover. The shift mirrors the speculative fervor once seen in crypto, with retail investors adopting leveraged ETFs and margin lending to amplify returns. Government policies under President Yoon Suk Yeol, aimed at reducing the "Korea Discount" through corporate governance reforms and dividend incentives, have further fueled the equity boom, as detailed in The Great Korean Pivot: From Memecoins to Machine Chips.

Meanwhile, global crypto firms are eyeing South Korea's market for expansion. Bybit, a Singapore-based exchange, is reportedly in talks to acquire Korbit, the country's fifth-largest crypto platform, as reported in Bybit in Talks to Acquire South Korea’s Korbit Exchange: Report. The move could intensify pressure on local financial institutions, which remain excluded from digital asset activities under strict regulatory rules. Analysts note that foreign exchanges are increasingly capitalizing on South Korea's liquidity-rich but policy-restricted environment, as reported in Bybit in Talks to Acquire South Korea’s Korbit Exchange: Report.

The migration from crypto to equities reflects a broader reallocation of risk appetite rather than a retreat from speculation. Leveraged retail positions now comprise nearly 30% of total holdings, with younger traders leading the charge. However, the shift has left global crypto markets without a key liquidity anchor, contributing to stagnation in bitcoin and altcoin prices despite recent all-time highs, as detailed in The Great Korean Pivot: From Memecoins to Machine Chips.

South Korea's retail traders, once the heartbeat of crypto volatility, now chase AI-driven equity gains. Yet history suggests they may return to crypto when the stock market cools or a new narrative emerges. For now, circuit boards have replaced blockchains as the nation's speculative engine.