Crypto Market Records, Kimchi Premium and Credit Suisse Losses

7 abr 2021

The week started with the highest possible note for the cryptocurrency market. First, the XRP token added several tens of percent per day, then Ether showed new all-time highs, added 180% since the beginning of the year. As a result, the capitalization of the cryptocurrency market exceeded the $2 trillion mark. And while this is still a drop in the sea of ​​financial markets, this drop has doubled in size over the past two months.

One of the options for making money on the cryptocurrency market is spatial arbitrage, that is, buying and selling cryptocurrency at the same time on different exchanges due to the difference in quotes. How does it seem to be possible in the 21st century. But the reasons for price discrepancies can be quite specific.

One of the examples of such arbitration today is the so-called "kimchi premium". The bottom line is that if on Coinbase the price of bitcoins was around $59,000 yesterday, then on the Korean crypto exchange Bithumb, Bitcoin was sold at $69,000. How is it there? The closed nature of the South Korean crypto exchanges for non-residents, multiplied by the problems of converting Korean won into dollars, and we have the opportunity to earn $10,000 with almost one click on each bitcoin.

Credit Suisse apparently wanted easy money, but it turned out exactly the opposite. Credit Suisse Group AG lost about $4.7 billion thanks to the collapse of Archegos Capital Management.

In the oil market, meanwhile, India has decided to take revenge on Saudi Arabia. India's state-owned refineries will buy 36% less oil from Saudi Arabia than usual. The reason is that India is very unhappy with the moves of Saudi Arabia to artificially reduce the supply of oil, which provoked a sharp rise in oil prices. Because of this, already vulnerable Indian economy is negatively influenced by the pandemic.