Bitcoin Price Drops 33% in South Korea Following Martial Law Declaration
Bitcoin (BTC) experienced a significant price drop on South Korean exchanges amidst a political crisis, with prices falling over 30% following the President's announcement.
South Korea Declares First Martial Law In 44 Years
On Tuesday night, South Korean President Yoon Suk Yeol declared an “emergency martial law” for the first time in 44 years, leading to widespread panic and a sell-off of Bitcoin and other cryptocurrencies.
The declaration replaces civilian government with military rule and suspends civilian legal processes. It allows restrictions on freedom of speech, assembly, and changes to governmental authority, although parliament can request its lifting.
In a televised briefing, Yoon stated that the measure aimed to eradicate pro-North Korean forces and protect the democratic order, accusing the opposition of anti-state activities. The opposition Democratic Party holds a majority in parliament, complicating Yoon’s agenda.
Through this martial law, I will rebuild and protect the free Republic of Korea, which is falling into the depths of national ruin. I will eliminate anti-state forces as quickly as possible and normalize the country.
Democratic Party leader Lee Jae-Myung announced plans to nullify Yoon’s order but expressed concerns about military actions against parliament members.
Bitcoin And XRP See Negative Kimchi Premium
Following the news, Bitcoin's price dropped sharply against the South Korean Won (KRW), falling 27% on Upbit, Korea's largest crypto platform.
Bitcoin fell from approximately 132 million KRW (around $92,000) to as low as 88.26 million KRW (around $62,000) but has since rebounded above pre-crash levels. On global exchanges, Bitcoin temporarily fell below $94,000 before returning to the $95,000-$96,000 range.
XRP also saw a price retracement of 60%, dropping from 4,000 KRW to as low as 1,623 KRW (around $1.23) but recovered to trade at 3,600 KRW (valued at $2.52).
Wu Blockchain reported that the negative “Kimchi Premium” resulted from Korean exchanges not allowing institutional market makers, leading to price synchronization issues due to high traffic.
Ultimately, reports indicated that Parliament voted to nullify the martial law after three hours. As of this writing, Bitcoin is trading at 133.2 million KRW on Upbit.
