How it works
The kimchi premium shows how much higher Korean exchange prices run compared to global exchanges (typically Binance). It reflects local demand surges or capital-control friction, and is often cited as an arbitrage signal. A negative value means a "reverse premium" — Korean prices are actually cheaper.
FAQ
Q. Can I profit from a high kimchi premium via arbitrage?
A. Theoretically yes, but Korea's foreign exchange and capital controls make it very difficult for individuals to actually execute this arbitrage.
Q. Why does the kimchi premium exist?
A. It widens when domestic buying demand surges, or when cumbersome remittance and FX procedures prevent capital from flowing freely between markets.