In December 2018, a fintech company called Cindicator analyzed the Korean blockchain market to provide insights on its overall market performance. Here are the top 7 findings:
- Compared to global prices, the Bitcoin price in South Korean won was on average 5.5% higher (from 20 Nov. 2017 to 20 Nov. 2018).
2. South Korean crypto assets tend to be more volatile than those in the Top 10 index, demonstrating sharper selloffs during bearish periods and larger buy-ins during bullish market conditions.
3. After discovering countless crypto pyramid schemes, the South Korean government initially took a prohibitive stance in blockchain development and trading to protect Korean citizens from speculative mania. The government has since changed its stance, and the regulatory landscape is looking favorable towards blockchain development.
4. South Korea has the most crypto-friendly population among other countries. The country is estimated to account for 30% of total cryptocurrency trading worldwide; additionally, 30% of all salaried workers in South Korea own and exchange cryptocurrencies.
5. In 2019, the Korean government announced a 1 trillion won (USD $880 million) budget allocation solely devoted to blockchain development as part of an overarching economic initiative (with a total budget of 5 trillion won).
6. South Korea is anticipated to have the second highest rate of economic growth when compared to other countries included in the analysis. This includes Germany, the United Kingdom, Japan, France, the United States, and Canada.
7. The Governor of Jeju Island recently requested that the central government classify Jeju Island as a Special Economic Zone (SEZ) for Korea’s blockchain companies to conduct crypto-related fund-raising activities and ICOs. Should legislation pass, this would set the groundwork for a government-supported crypto hub in Korea.
Metadium’s price development analysis was among other well-known Korean projects. To analyze price evolution, Cindicator compared past performances of ICOs (in the sample) with a top 10 cryptocurrency index (and equal weighted index) comprising of: Bitcoin, Ethereum, Ripple, Bitcoin Cash, EOS, Stellar, Litecoin, Cardano, Monero and TRON).
“Korean cryptocurrencies tend to be more volatile than the Top 10 index, given that they tend to fall below the index when the market is bearish and to outperform it when the market is bullish. This could be due to the fact that Korean projects are in an early phase of their life with respect to the constituents of the Top 10 index, and therefore they are more subject to consistent price swings.” — Cindicator
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*Cindicator’s Korean Market Analysis Report was used to write this blog.