CoinMarketCap, the most prominent global index of cryptocurrency prices, on Monday removed prices from South Korean exchanges from its calculations of digital currency rates, Reuters reported.
The website removed data without any explanation from three of the largest South Korean exchanges: Bithumb, Coinone, and Korbit. The move resulted in a steep drop in all virtual coins they track.
”Every crypto is priced at a 30 percent premium in South Korea,“ said Greg Dwyer, head of business development at cryptocurrency derivatives exchange BitMex.
”By removing that, it looks like the market cap fell by 30 percent and so people rushed to sell because they’re not sure what’s happening," he added.
Though the change was made at midnight Sunday U.S. EST, CoinMarketCap did not publicize it until midday on Monday, saying that the Korean exchanges showed “extreme divergence in prices from the rest of the world and limited arbitrage opportunity.”
This morning we excluded some Korean exchanges in price calculations due to the extreme divergence in prices from the rest of the world and limited arbitrage opportunity. We are working on better tools to provide users with the averages that are most relevant to them.
— CoinMarketCap (@CoinMarketCap) January 8, 2018
Analysts says cryptocurrency prices tend to be much higher on South Korean exchanges because of huge demand and monetary restrictions in that country.