# Korea Premium Index

## Definition

Korea Premium Index is the percent difference between the VWAP of Korean exchanges and other exchanges. 

## Interpretation

Korean crypto market is mostly made up of retail investors due to regulations against institutional investors and stable coins. 

Utilizing this unique market structure, Korean Premium Index indicates the **closest meaning to the retailers' sentiment and buying power** or particularly Korean market buying power. 

Historically,  Korean premium over 16 percent gave an indication that the price could be a local top or an indication of FOMO in the market.

![](https://3443265903-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FwY9jt5nY3DeH5c1WCCsW%2Fuploads%2FZ9dwMcLk29A0OhWMgpNP%2Fimage.png?alt=media\&token=8ffa5d4c-03dc-4af4-9bdd-ac02781107d1)

### By value itself <a href="#interpretation" id="interpretation"></a>

![](https://3443265903-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FwY9jt5nY3DeH5c1WCCsW%2Fuploads%2F0Ig2YSJt4MZUxQRmaO4D%2Fimage.png?alt=media\&token=50e1bfb2-c177-4cdf-b24d-97c3f4bb216f)

It shows how much premium retailers or Koreans are willing to pay for the purchase&#x20;

* **Above '0' (+)**:  Retailers are willing to pay a **premium** for the purchase
* **Below '0' (-)**: Retailers are only willing to purchase at a **discount**&#x20;

### By examining trend  <a href="#use-case" id="use-case"></a>

It shows the **level of retailers' Activeness & Volatility**

* **Increasing trend** : **Expanding interest and activeness**&#x20;

  Increasing values in the Korean Premium Index indicates that more retailers are continuously buying at a higher price than average market price.
* **Decreasing** **trend** : **Diminishing interest and activeness**

  Decreasing values in the Korean Premium Index indicates that retailers are continuously selling at a lower price than average market price.

## Link to Our Data

* [BTC: Korea Premium Index in CryptoQuant Live Chart](https://cryptoquant.com/overview/btc-market-data/465?window=day)
* [ETH: Korea Premium Index in CryptoQuant Live Chart ](https://cryptoquant.com/overview/eth-market-data/466?window=day)