5 Ways to Read Kimchi Premium Numbers, Using a ₩1 Million Example

Multiply the kimchi premium percentage by the amount valued at the overseas price, and you get the extra money you pay in Korea. That one idea is all you need to read kimchi premium numbers. Below, let us put it in terms of ₩1 million worth.

How is the kimchi premium calculated?

The kimchi premium is the ratio showing how much more expensive the same coin is on a Korean exchange than on an overseas exchange. The formula is:

If the Korean price is 1.03 times the overseas price converted into won, the premium is +3%. Some sites use the won price of Tether (USDT) instead of the exchange rate, so even at the same moment the value differs slightly from site to site.

How much are +0.5% and +3% on ₩1 million worth?

If you buy coins in Korea that are worth ₩1 million at the overseas price, it works out like this:

• +0.5%: it costs ₩1,005,000. You pay ₩5,000 more.
• +3%: it costs ₩1,030,000. You pay ₩30,000 more.

If you spend exactly ₩1 million in Korea, the difference is slightly smaller. At +3%, the coins you buy for ₩1 million are worth about ₩971,000 at the overseas price, so the extra you pay is about ₩29,000.

How cheap is −1% (a reverse premium)?

When the kimchi premium is negative, it is called a reverse premium. It means the Korean price is lower than abroad. You can buy ₩1 million worth at the overseas price for ₩990,000 in Korea, so the price is ₩10,000 lower.

But being cheap does not mean the price will rise from here. It only tells you the current price gap.

What does the actual premium right now come to on ₩1 million worth?

As of 9 p.m. KST on October 15, Bitcoin's kimchi premium was +0.51%. On ₩1 million worth at the overseas price, that is a difference of about ₩5,100. At the same time, Blur (BLUR) was at +2.18%, which is about ₩21,800.

The numbers keep changing. You can compare the current values coin by coin in the kimchi premium ranking.

How much is left after fees and the tick size?

The trading fee is the cost the exchange takes each time you buy or sell. Assuming 0.05%, it is ₩500 on a ₩1 million purchase and about ₩500 on the sale, so about ₩1,000 for the round trip.

The tick size is the size of one step by which an order price moves. Take a hypothetical coin priced at ₩1,000 where one tick is ₩5. If you buy with a market order, you buy at ₩1,005, and if you sell right away, you sell at ₩1,000.

With ₩1 million you buy about 995.02 coins, and selling them gives about ₩995,025. That one tick makes about ₩4,975, roughly ₩5,000, disappear.

Add the round-trip fee of about ₩1,000 and it comes to about ₩6,000, which is more than the ₩5,000 of a +0.5% premium. A small premium gap is buried by a single tick and the fees alone.

The kimchi premium is not money you have earned; it is a difference sitting on top of the price. If you buy at +3% and sell at +3%, the premium itself brings no gain or loss, and only the change in the coin's price remains. So read the kimchi premium number as a gauge of how much extra you are paying right now.