The price of Storm, the token of a blockchain network that incentivizes users for carrying out microtasks such as viewing ads, trying out new applications, and filling up surveys, has surged 200 percent after the South Korean cryptocurrency exchange market listed it.
South Korea Pump
Last week, Upbit, the second largest cryptocurrency exchange in the global market with 11.54 percent of the market share as demonstrated by LiveCoinWatch, integrated Storm. The listing of Storm by Upbit, South Korea’s biggest cryptocurrency trading platform, introduced the token to the third largest cryptocurrency exchange market overnight.
The result of Upbit’s sudden listing of Storm was a 200 percent increase in the price of the cryptocurrency, and against all expectations, Storm became the second most liquid asset within the global cryptocurrency market, surpassing the daily trading volume of Ethereum and Tether.
In the South Korean cryptocurrency exchange market, the vast majority of exchanges are conservative towards adding new cryptocurrencies, primarily due to the limited supply of cryptocurrencies in the local market. Leading exchanges such as Bithumb and Korbit are known to conduct long-term analysis of cryptocurrencies before listing them.
For instance, with Zcash and Qtum, both Bithumb and Korbit evaluated the market of the two cryptocurrencies for two months before ultimately deciding to integrate the two cryptocurrencies on their respective trading platforms.
ICON (ICX), better known as South Korea’s Ethereum, also experienced a massive increase in price due to the listing of Bithumb, the country’s second biggest cryptocurrency exchange behind Upbit. The price of ICX rose from $1.63 to $4.11, almost tripling due to the integration of ICX by Bithumb.
For several years, the South Korean market has been an important indicator of market stability, especially during periods of extreme volatility. Late last year, when the price of bitcoin reached $19,000, in the South Korean market, the price of bitcoin nearly achieved $24,000.
The premium on cryptocurrencies in Japan, South Korea, and Hong Kong often represent existing demand towards the cryptocurrency market. At the time of reporting, the premium in the South Korean market remains just over 3 percent, which is decent considering that the cryptocurrency market has been in a slump for several weeks.
In the future, the South Korean market could become a problem for investors, as cryptocurrencies, especially initial coin offerings (ICOs), will eye the cryptocurrency market of South Korea as a gold mine. It will continuously try to be listed on Bithumb, Korbit, and Upbit, in a desperate attempt to experience an initial short-term pump in price, and continuous support from the South Korean market.
The South Korean and Japanese market were two major factors for the recent decline in the price of most cryptocurrencies, because speculators bought into cryptocurrencies and tokens that they do not necessarily believe will be utilized extensively in the long-term. Many investors bought cryptocurrencies with low price, but high market cap, in an attempt to see large short-term returns.
Conclusively, while it is optimistic that there exists demand for decentralized applications launched on top of the Ethereum network and utility tokens, it is crucial that investors don’t buy into cryptocurrencies solely out of FOMO (fear of missing out), as it may lead to major corrections in the mid to long-term.