A portion of the explosive price increase in alternative cryptocurrencies (altcoins) over the last several months might be attributed to South Korean traders, who are well-known for taking excessive risks and frequently igniting token speculative frenzy.
Analysts at on-chain data company CryptoQuant revealed in a note on Friday that spot volumes on local exchange Upbit have almost doubled since September.Upbit, which accounts for more than 85% of all trading activity in Korea, saw an 82% increase in trade volume from $32.8 billion to $59.8 billion in October over September.
Rising volumes may have caused a flywheel effect, drawing in traders and market makers who then invested their profits to keep buying in the expanding market.Notable booms include LOOM from Loom Network, which saw a price increase of about 10 times in less than two months, and HIFI, which saw a price increase of 6,600% in just September.
“For coins that are only listed on Korean exchanges, if there is a significant increase in trading volume, listing futures on them has been popular on overseas exchanges,” CryptoQuant’s analyst Bradley Park said in a message. “From an on-chain perspective, market makers are the buying power.”
Park continued, saying HIFI’s Upbit reserves increased. Upbit’s hi-fi reserves increased from 62 million tokens to 82.9 million tokens, a 27.5% increase.According to Park, this indicates that South Korea is a key player in altcoin rallies, as CoinDesk reported.
The majority of the HIFI decentralized lending and borrowing platform’s surge occurred prior to Binance’s mid-September launch of perpetual futures linked to HIFI. The token’s price dropped after debut.
Bitcoin continues to hold its leading position globally, despite a surge in activity on South Korean exchanges related to altcoins.The market dominance of bitcoin, which measures its capitalization relative to the market as a whole, increased to 53% over this time frame from 49%, indicating that traders continued to favor this leading cryptocurrency.According to figures, the total market value increased from slightly over $1 trillion at the beginning of September to $1.4 trillion on Friday.