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Topic: [2017-05-12]Bitcoin Price Surges Past $2,070 in South Korea, Arbitrage Opportun (Read 15446 times)

full member
Activity: 448
Merit: 100
There's a reason premiums exist.

They're often inefficiencies that have crept into an exchange's workings, typically through the funding channels and redemption pathways. So, to say that an easy "arb" is possible, ignores the fact that the only reason that premium exists, is to tell you that the arbitrage opportunity may be cumbersome or potentially insurmountable if you are not a citizen of that country. Again, dislocations in market pricing exist to show us something, it isn't all an easy ride to riches.

Now, if you were an entrepreneurial type, you'd explore opening a company in South Korea with the sole intention of leveling that premium. However, that costs money and time, so not every investor will have the patience it would take to exploit such a difference.

Strangely enough, South Korea today is very good at showing economic growth, unlike its neighbor, North Korea. According to the latest forecasts, it is very clear that the countries of Asia have actively started to operate in the field of cryptography, this leads to the idea that it would be nice to organize some kind of event or business online
legendary
Activity: 2408
Merit: 1121
There's a reason premiums exist.

They're often inefficiencies that have crept into an exchange's workings, typically through the funding channels and redemption pathways. So, to say that an easy "arb" is possible, ignores the fact that the only reason that premium exists, is to tell you that the arbitrage opportunity may be cumbersome or potentially insurmountable if you are not a citizen of that country. Again, dislocations in market pricing exist to show us something, it isn't all an easy ride to riches.

Now, if you were an entrepreneurial type, you'd explore opening a company in South Korea with the sole intention of leveling that premium. However, that costs money and time, so not every investor will have the patience it would take to exploit such a difference.
sr. member
Activity: 448
Merit: 250
https://saturn.black
If someone from SK wants to come here I'ld sell them a chunk of my coins for that price.  Strangely, there is a reasonably strong chance that I wouldn't sell them for that price by the end of this year.  Here is to hoping!

Caveat:  this is NOT an offer to sell on this forum by yours truly.

There is a great chance that soon and on our exchanges it will be possible to trade bitcoin at such a price. Now bitcoin is becoming more expensive and it seems soon that he will overcome the limit of 2000 dollars. I hope
hero member
Activity: 761
Merit: 606
If someone from SK wants to come here I'ld sell them a chunk of my coins for that price.  Strangely, there is a reasonably strong chance that I wouldn't sell them for that price by the end of this year.  Here is to hoping!

Caveat:  this is NOT an offer to sell on this forum by yours truly.
legendary
Activity: 2016
Merit: 1107
same as India,not so long ago  Huh
there was a 15-20% premium on bitcoin in India,just after their fiat currency reform
the problem with arbitrage is the liquidity and ability to deposit/withdraw to and from indian exchanges
it wasn't that easy for the foreighners,limiting the said arbitrage opportunities
guess there will be same problem with korean exchanges as well,besides you will need to send your id to get verified and that takes time
hero member
Activity: 602
Merit: 500
Bitcoin Price Surges Past $2,070 in South Korea, Arbitrage Opportunity?
https://www.cryptocoinsnews.com/bitcoin-price-surges-past-2070-south-korea-arbitrage-opportunity/

As of May 12, bitcoin price in the South Korean exchange market is $2,076, approximately 12.7 percent higher than that of the global average price. To be exact, bitcoin is being traded on South Korean exchanges and trading platforms at a price that is $269 higher than the global average price of $1,807.

Ever since the debut of venture capital backed and regulated bitcoin exchanges including Korbit and Bithumb, the South Korean bitcoin exchange has presented excellent arbitrage opportunities for traders. South Korean bitcoin exchange have always demonstrated a high premium on their listed bitcoin prices and trading rates.
“This kind of gap exists in other markets too, but the South Korean situation is atypical because it’s by no means a small or immature market. The trading volume on Bithumb (the larger of the two exchanges, with nearly twice the depth of its competitor Korbit) during the last 30 days has never dropped below 1,390BTC, with an average of about 3,000BTC (and a high of over 6,000).”

Considering that the South Korean exchange market is mature and developed, which is quite evident considering that it is the fourth largest bitcoin exchange market behind Japan, the US and China, one explanation that could rationally justify arbitrage opportunities and high premium bitcoin prices listed by local bitcoin exchanges is the presence of strict Know Your Customer (KYC) and Anti-Money Laundering (AML) policies.

According to bitcoin researcher Cryptonight, the author of the above-mentioned analytical blog post, South Korean businesses will likely be questioned by the local government and central bank if they attempt to purchase large amounts of bitcoin in overseas. Vice versa, if a foreign business was to sell large amounts of bitcoin on South Korean exchanges, it would be questioned by the local government in regard to the purpose of the funds.

“If a Korean-owned business were to attempt to buy Bitcoin in large quantities from overseas, they would be questioned and likely fined if they couldn’t properly explain the purpose of the purchase. And because Bitcoin has a “no value” in the eyes of the government, the notion that these businesses were sending millions of Korean won (or thousands of USD) overseas looks a lot like money-laundering,” explained Cryptonight.

Most importantly, although bitcoin is being traded at a premium rate that is substantially higher than most markets, it is extremely difficult for foreign or external traders to open bank accounts in South Korea. Hence, even if traders securely purchase bitcoin overseas and attempt to sell it on South Korean bitcoin exchanges, they wouldn’t be able to do so without opening South Korean bank accounts that are not easily accessible to foreigners.
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