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33 Koreans Arrested Over Bitcoin Kimchi Premium | Blockchain & Crypto News | The Daily Forkast - YouTube
Channel: Forkast News
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elcome to The Daily Forkast, July 8th, 2021.
I'm Angie Lau. Editor-in-Chief of Forkast.News,
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covering all things blockchain.
Coming up, Korea penalties for the kimchi
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premium, Chengdu holds China's latest digital
yuan trial and Taiwan's Lootex uses NFTs to
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preserve cultural history.
Let's get you up to speed from Asia to the
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world.
The kimchi premium has become the kimchi penalty.
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South Korea has arrested 33 people in connection
of violating the country's Foreign Exchange
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Transactions Act using crypto. One of them
is a university student who earned two billion
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KRW. That's about US$1.7 million through what's
known as the kimchi premium arbitrage. That's
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when people purchase Bitcoin outside Korea,
then sell it back in Korea to make a profit,
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taking the difference as the Bitcoin price
in South Korea has been significantly higher
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than in other places around the world.
In the past year, Bitcoin's kimchi premium
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has ranged from five to over 20% over the
global market price.
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Now, the arbitrage itself is not illegal,
but violations happened when South Koreans
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who do it make false reports to authorities
when moving their money into foreign exchanges,
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which is illegal. By law, Korea requires all
foreign remittances of over US$5,000 to be
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examined by banks. In most cases, banks don't
allow those remittances to be made for investing
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in crypto overseas.
Now we talk to Crypto billionaire Sam Bankman-Fried,
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who made his name by capitalizing on the kimchi
premium on FTX, saying the clampdown is all
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about control.
“The Korean government does not want people
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to be able to freely transact with [Korean
won] for speculative purposes, and they’re
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worried about crypto being used as a means
for that. So they’re clamping down, really
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indirectly, on the arbitrageurs and market
makers.”
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The student caught by Korean Customs Service
had sent around US$35 million to Hong Kong
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over the course of 851 transactions from March
2018 to June 2018, most of which was spent
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on buying crypto. Those tokens were later
sold on a Korean exchange for which they earned
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the kimchi premium of US$1.7 million. The
remitted amount was falsely reported to customs
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as expenses for studying abroad.
Though I would wonder how a student would
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get access to US$35 million, that's probably
another question. But according to authorities,
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more than 33 people — some of who have already
been fined — had carried out US$1.5 billion
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worth of transactions in total.
China's plans for its digital RMB are forging
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ahead. Local media reports that a 15th round
of testing of the RMB is now underway. That's
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right — the fifteenth time.
This time, it is in Chengdu and the focus
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is on green commuting. 12 million digital
yuan, or around US$1.8 million has been given
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out in a lottery to residents for use on public
transport and shared bikes. China plans to
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fully unveil its digital yuan at the 2022
Beijing Winter Olympic Games.
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And onto the markets now. Bitcoin was down
almost 6.5% at just under US$32,500. That's
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as of 4 p.m. Hong Kong time at the end of
the local Asian trading day. And in the top
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10 for cryptocurrencies, in a day of mostly
read across the board, Uniswap was down 11.5%,
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and Dogecoin down 9.5%.
And finally today, Taiwan's Lootex — a decentralized
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auction house — is selling NFTs not just
as a work of art, but as a way of preserving
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cultural history amid concerns over politics.
Legendary Hong Kong comics, Chinese Hero Buddha's
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Plam and Teddy Boy are all now available as
limited edition manga NFTs. Lootex says they
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are doing so in case of restrictions being
imposed on publishing in Hong Kong.
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"[The Hong Kong government] could take aim
at some comic books such as Teddy Boy or Buddha's
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Plam. These could be something that don't
really fall in favor of the government. So
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I feel we are doing something meaningful,
as to help preserve their culture."
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In this case, NFT is not just about the future
of art, now also about preserving the present.
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And that's The Daily Forkast from our vantage
point right here in Asia. For more, visit
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Forkast.News. I'm Editor-in-Chief Angie Lau.
Until the next time.
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