Bithumb’s “No-Charge” Promotion Accountable For BTC Quantity Spike in South Korea: Analyst

• Bradley Park thinks the spike in BTC quantity traded on South Korean crypto exchanges just isn’t sustainable.
• Bitcoin buying and selling accounted for about 30% of volumes traded on home South Korean exchanges this 12 months.
• The surge in Bitcoin buying and selling quantity in South Korea coincides with Bithumb’s “no-fee” promotion.

The current spike in Bitcoin quantity traded on South Korean crypto exchanges just isn’t sustainable, based on Bradley Park, an analyst at CrypoQuant. Park’s opinion stems from the basic causes behind the noticed change within the funding perspective of crypto merchants within the Asian nation.

In accordance with CryptoQuant knowledge, Bitcoin buying and selling accounted for about 30% of volumes traded on home South Korean exchanges this 12 months. That could be a departure from the historic buying and selling sample amongst crypto merchants within the area. As an example, the best ratio of Bitcoin quantity on South Korean exchanges in 2023 was 13.5%, recorded in Could final 12 months.

Additional examine of the CryptoQuant knowledge exhibits that smaller tokens within the type of altcoins took the hit and skilled important deficits in buying and selling volumes. Therefore, that class of digital belongings that usually makes up over 80% of the buying and selling quantity on South Korean exchanges dropped to lower than 70% this 12 months.

Notably, the surge in Bitcoin buying and selling quantity in South Korea coincides with Bithumb’s promotion that erased buying and selling charges for Bitcoin buying and selling on its platform. On account of the promotion, Bithumb’s market share spiked to 40% from a comparatively low 12% in October, when the promotion started. 

The swing in market share affected Upbit, a dominant trade within the area, whose market share dropped from 80% to 54% throughout the identical interval, based on knowledge from CryptoQuant. Therefore, the Bitcoin quantity shift triggered by Bitcoin seems to consequence from capital flight from Upbit to Bithumb.

As a matter of curiosity, Bithumb’s no-fee promotion ends this month, and there are indicators of buying and selling exercise returning to Upbit. Therefore, the current adjustments in market share and Bitcoin buying and selling quantity could possibly be temporal. In accordance with Park, apart from the noise of Bitcoin quantity on Bithumb, Korean buying and selling habits in all probability received’t change a lot.