Chinese state television has sought to document the toll taken on South Korean cryptocurrency companies by 2018’s bear market, with Financial Channel (CCTV-2) producing a report detailing the challenges faced by Korean miners. According to the report, last year’s bear trend was further exacerbated by a 97.5 percent drop in Korean cryptocurrency premiums, driving between 70 and 80 percent of miners to desist operations.
Also Read: Overstock Becomes the First Major US Company to Pay Business Tax in Bitcoin
70 to 80 Percent of South Korean Miners Estimated to Have Ceased Operations During 2018
The report discusses the start of the South Korean cryptocurrency mining industry with the operator of a mine who purchased roughly 1,000 mining rigs for generating ether while prices were approaching all-time record highs during January last year.
Financial Channel estimates that the cost of mining a single ether was roughly 214,000 Korean won (KRW) (approximately $190) at the start of 2018, adding that the surging altcoin markets of mid-January would see ETH trade for 2.35 million KRW each.
Despite the exorbitant profits that were on offer while prices were hovering near early 2018’s record highs, the operator estimates that four out of every five South Korean mining businesses operating at the start of the year has since shut down. “To my knowledge, 70 to 80 percent of mining farms have ceased operation, and many even declared bankruptcy,” the miner stated.
Korean Share of Global Cryptocurrency-to-Fiat Trade Drops by Half Year-Over-Year
Financial Channel asserts that the challenges faced by Korean miners were compounded by a dramatic slump in the premium on cryptocurrency prices in Korea — the so-called “Kimchi premium” — from as high as 40 percent at the start of 2018 to just 1 percent today.
The report adds that as of Dec. 31, 2018, South Korea’s central bank, the Bank of Korea, estimated that KRW pairings accounted for approximately 5.8 percent of global trade between cryptocurrencies and fiat currencies, a more than 50 percent drop when compared with KRW volume as of the end of 2017.
Do you know any miners who had to cease operations last year due to falling cryptocurrency prices? Share your story in the comments section below.
Images courtesy of Shutterstock.
At Bitcoin.com there’s a bunch of free helpful services. For instance, have you seen our Tools page? You can even look up the exchange rate for a transaction in the past. Or calculate the value of your current holdings. Or create a paper wallet. And much more.
The post Report: 70 to 80 Percent of South Korean Miners Shut Down in 2018 appeared first on Bitcoin News.
Leave a Reply