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Bitcoin prices hit fresh record amid Coinbase IPO expectation

A digital board at cryptocurrency exchange Bithumb shows the prices of various digital coins. (Yonhap)
A digital board at cryptocurrency exchange Bithumb shows the prices of various digital coins. (Yonhap)
The price of a bitcoin hit another record high, both in local and global exchanges, buoyed by the expectation for the highly anticipated public listing of US crypto exchange Coinbase Global.

Bitcoin prices rose to above 82 million won ($73,000) on domestic exchanges early Wednesday, while the coin’s price on overseas exchanges reached new heights at $63,742 per unit.

The prices for Ethereum, the second-largest digital coin by market capitalization, also touched its highest points, rising to 3.02 million won on Wednesday on domestic exchange Upbit and $2,349 overseas, according to CoinMarketCap.

The rally came as US crypto exchange Coinbase is set to begin trading on Nasdaq on Wednesday with a valuation of $65 billion, which is a significant jump from the company’s 2018 valuation of $8 billion. The company, founded in 2012, is estimated to have recorded $1.8 billion in revenue in the first quarter.

In addition to the valuation of the company, eclipsing Intercontinental Exchange, the parent of New York Stock Exchange, with its current worth of $26 billion, the listing of Coinbase could be a milestone for the crypto industry as it could be a turning point for mainstream acceptance.

Meanwhile, the surge in cryptocurrencies appears to be more heated in South Korea, as evidenced by the widening “kimchi premium,” or the gap in cryptocurrency prices between South Korean exchanges and foreign avenues. The premium here for a bitcoin reached almost $10,000 on Wednesday. Along with the widening gap, overseas money transfers increased, raising suspicions that some investors are trying to buy bitcoins on overseas exchanges and transfer the digital asset to domestic exchanges to take advantage of the arbitrage opportunity.

It is difficult to gauge the exact value of transfers made to purchase cryptocurrencies in overseas markets, but the unusual rise in transfers may give some indication of such an activity.

According to a local bank, the amount of overseas remittance witnessed within the first seven business days this month stood at $13.64 million, already exceeding the level of some $9.18 million recorded in March 2021.

On Wednesday, in a bid to prevent possible illegal activities such as money laundering, five major commercial banks delivered warnings to their branches to be extra careful with remittance requests without supporting documentation and to question customers regarding even transfers lower than $50,000. Local laws currently allow remittance of up to $50,000 without producing documentation.

By Park Ga-young (gypark@hearldcorp.com)
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