XRP takes center stage in South Korea
When political and economic turmoil occurs, people often gravitate toward stablecoins like Bitcoin or USDT. However, South Korea went against convention. As demonstrations against President Yoon Seok-yeol intensify, cryptocurrency traders in the country are turning to XRP instead of Bitcoin. Trading volume shows this change. Zhong Yang Chan, head of research at CoinGecko, said, Ripple Bitcoin triples in value upper bitsSouth Korea’s largest cryptocurrency exchange is on its final day.
Source: UPbit
The political climate worsened when the president imposed martial law, an extraordinary step for a country with a long history of democracy.
The political situation worsened when the president declared martial law, an unusual move for a country with a long tradition of democracy. There were calls for impeachment as the decision caused huge outrage. The turmoil severely damaged the South Korean won, causing it to plummet. Cryptocurrency markets are not far behind, with XRP losing half its value locally and Bitcoin plunging 33%. Despite the sharp drop in prices, the riots gave savvy traders the opportunity to profit from price differences between domestic and foreign markets.
Investors are bracing for significant volatility amid growing political and economic turmoil in South Korea. Ian Cho, co-founder of ITAM Games, believes that the country’s cryptocurrency trading volume will hit a record high. Markets had been primed for such a massive event after months of political gridlock and declining victories. The currency has fallen 7% so far this year, recently hitting a two-year low.
In this turmoil, Upbit became an important player. According to data from Kaiko, the exchange’s market share has increased to around 11%, up from 4% a few months ago. Even the Kospi stock index is seeing a decline in trading volume compared to Upbit and other local markets. In November, the average value of cryptocurrency transactions on the local platform was $9.4 billion, compared with $7 billion on the Kospi index.
Despite the increase in Bitcoin activity, South Korean exchanges have not seen significant outflows. This suggests that investors may not move funds out of the country even in this uncertain environment. However, the depreciation of the Korean won is causing headaches for many people. Poor exchange rates tend to push more investors toward cryptocurrencies, but this time, the collapse in cryptocurrency prices was also linked to technical issues. During the crisis, centralized exchanges struggled to cope with the surge in traffic.
South Korea’s cryptocurrency market is experiencing a rare reversal. Historically, Bitcoin and other cryptocurrencies have traded at higher prices locally, a phenomenon known as the pickle premium. Now, this premium has turned negative. Analysts said this reflects South Korean investors’ hesitancy to view cryptocurrencies as a safe haven during uncertain times. Instead, many still view it as a risky asset.
Political and economic turmoil in South Korea is testing the resilience of the cryptocurrency market. While XRP has captured the attention of traders, Bitcoin’s performance highlights the difficulties faced by digital assets in the country. It is unclear whether cryptocurrencies will become a strong alternative to traditional assets. As markets continue to exceed expectations, the current focus is on controlling risk and dealing with volatility.
