70-80% of South Korean Miners Ceased Operations During 2018
Last year’s bear trend was further exacerbated by a 97.5% drop in Korean cryptocurrency premiums, driving between 70-80% of miners to desist operations. 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.
70-80% of South Korean Miners Shut Down in 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 ATHs during January last year. Financial Channel estimates that the cost of mining a single ether was roughly 214K Korean won at the start of 2018. The surging altcoin markets of mid-January would see ETH trade for 2.35M KRW each. Despite the exorbitant profits that were on offer while prices were hovering near early 2018’s record highs, the operator estimates that 4 out of every 5 South Korean mining businesses operating at the start of the year has since shut down. 70-80% of mining farms have ceased operation, and many even declared bankruptcy.
Korean Share of Global Cryptocurrency-to-Fiat Trade Drops
Financial Channel asserts that the challenges faced by Korean miners were compounded by a dramatic slump in the premium on cryptocurrency prices in Korea from as high as 40% at the start of 2018 to just 1% 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% of global trade between cryptocurrencies and fiat currencies, a more than 50% drop when compared with KRW volume as of the end of 2017.