For months, Ye-won Oh, a resident of Seoul, oversaw the cryptocurrency markets voraciously, refreshing his phone virtually every minute of every day. In early 2017, he invested $ 40,000 in Ethereum, which has become very popular in South Korea. Like many young Koreans living in Korea's difficult economy, she saw her investment as "the only way out".
The 20-somethings young man has an impressive resume: a high position in a flourishing startup, a university degree from abroad, and work experience in some of Korea's most enviable companies. But she and her husband can not afford a home in a city where the average deposit of an apartment is more than $ 400,000. "People like us, people who just start our careers and university students, it's very difficult for us because there is no way to build a stable life," says Oh.
For young Koreans, cryptocurrency seems a rare opportunity for prosperity. Months after last year's bubble started to implode in February, the Korean won remains the third most traded currency for Bitcoin. The country of 52 million comprises 17 percent of all Ethereum operations, and was the location of two-thirds of the world's largest exchanges this winter, Korea Expose reported in February.
It is estimated that three out of 10 salaried workers in Korea had invested in electronic currencies in December 2017, according to a survey by the Korean recruiting firm Saramin . Eighty percent of those people were between 20 and 30 years old.
But now that the prices of crypto currencies like Bitcoin, Ethereum and Ripple have collapsed, many young Koreans are grappling with the mental and financial consequences of their losses. Korean psychologists have reported an increase in the so-called "Bitcoin blues" patients, divorce counselors say that marriages are separating from failed investments, and even the country's prime minister said virtual currencies are on track to cause " serious distortion or pathological social phenomena "Among the young population of Korea. "As soon as I come to a standstill, I'll leave," says Oh. "It's just not mentally healthy."
From the outside, the Korean economy seems to be flourishing: the country is home to important industry leaders like Samsung, Hyundai and Kia. It is the eleventh largest economy in the world, with semiconductors, LCD screens for automobiles and other high-tech products that dominate its exports. The total unemployment rate is only 4.6 percent.
Even so, young people can not find work. Youth unemployment has hovered around 10 percent in Korea over the past five years. The underemployment rate, defined by those jobs that are involuntarily overqualified or that are part-time, is even higher as of this year: 38 percent, according to the professor of the University of Dongseo, Justin Fendos.
In this highly educated economy, it can be difficult for young Koreans to distinguish themselves from their peers. Almost 70 percent of all Koreans aged 25 to 34 have a post-secondary degree, the highest of all the countries in the Organization for Economic Cooperation and Development (OECD), and a high school diploma is almost universal . Whole neighborhoods in Seoul are full of college graduates studying to pass hiring exams in order to enter the largest companies in Korea or the enviable public sector.
"The design of Korean society is a big reason why cryptocurrency became so popular," says Yohan Yun, a 25-year-old assistant reporter in Seoul who invested around $ 400 in Ethereum. "People here are generally not happy with their current status in society"
Even young employees are pessimistic about their economic prospects: A survey conducted in 2015 showed that half of Korean youth do not believe they will do better than their parents' generation, compared to 29 percent in 2006.
"I can work for the next 30 years, I can pay off the debt of a two-bedroom house that I really do not like and a car, and that's the end of my life," says Fendos, who leads the studies He holds a bachelor's degree from Dongseo University and also directs a program at Fudan University in Shanghai. Even if a young Korean has funds available, investment opportunities are scarce, he adds. Real estate used to be the traditional way to grow fortune in Korea, but prices have become extremely expensive even for upper middle class people. And interest rates for savings accounts are rarely more than a few percentage points a year. "So, you are seeing this and you are wondering, what can I do to escape this?" Says Fendos.
Jason Cho, adviser to Bitcoin Center Korea, says that young people are "in a system where they constantly close their doors, and the benefits of this society go to the few at the top". Cryptocurrency, for some, is a way out.
The massive interest in cryptocurrency within South Korea began in earnest in the fall of 2017, according to the commercial volume data of the Korean cryptocurrency exchange firm Korbit. Oh, he invested in early 2017, the time that probably allowed him to earn more than the average Korean trader.
Yun started trading in the summer of 2017 when the market really started to heat up. "You hear all these people make so much extra money for that," says Yun. "You have your friends who did not have anything, [and] suddenly they are buying cars, and you start to feel jealous."
The hyper connectivity of Koreans helped to stimulate the popularity of Bitcoin. Teens and young adults spend about four hours a day using mobile phones in Korea. Almost all Korean homes have Internet access, and 88 percent have smartphones, the highest percentage worldwide. Such an abundance of connectivity allowed potential traders of all ages to learn about insanity and hear about the huge amounts of money one could get in the trade. The criptomado clubs, where people can meet like-minded traders and share tips, came up in many Korean universities.
Thanks in part to the frenzy, some coins cost up to 51 percent more in Korean markets than anywhere else. The price of Bitcoin rose almost $ 8,000 in January, reported Bloomberg . The "kimchi premium" attracted foreign merchants to buy their currencies abroad and exchange them in the Korean market.
But then comes the collapse. From January 6 to January 16, 2018, the Bitcoin price for the Korean won fell from a maximum of $ 25,065 to $ 13,503, according to Korbit. It continued to fall to $ 7,410 until February 5 and, as of April 2, the price of a bitcoin amounts to $ 7,241.
In total, the Bitcoin crash voided $ 44 billion worth in January, or more than all of Ford's stock market capitalization, according to Bloomberg . The new regulations against the cryptocurrency trade, particularly those of a concerned South Korean government, helped usher in the fall.
Sijin Lee, 22, did not start trading until November. He is a third-year student at Kyung Hee University, a prestigious university in Seoul. Lee's investment increased fivefold during the winter months, but now he has lost half of his capital. He calculates that 70 percent of his friends who exchanged crypto lost money.
Extreme fluctuations caused emotional havoc on many merchants, many of whom had invested much of their life savings. When Bitcoin fell 10 percent in January, merchants shared photos of computers, sinks, bathtubs and doors that furiously destroyed. "Why is my life always like this?" Wrote a merchant with a picture of his anger-induced vomit. "I do not even want to clean up." A Bitcoin community included the temperature of the Han River in Seoul, in case the low prices persuaded merchants to "swim" (ie, jump off a bridge to kill themselves).
The South Korean media have linked multiple suicides to falling cryptocurrencies. A university student of about 20 years who had invested $ 18,500 in cryptocurrencies was reported dead by suicide on February 1. Later that month, the mother of a 30-year-old computer worker found her own son who committed suicide. His friends told the local media that he had lost almost $ 10,000 in cryptocurrency.
Oh, he says he's still positive, but he can relate to the frenzy. She and her husband lost $ 20,000 for a massive $ 250 million mining scam. "It was very bad, but it did not stop me," says Oh. "It really did not impact me in terms of my confidence in Ethereum's strength as a currency."
That resolution worries many senior government officials, who imposed a series of regulations earlier this year to keep cryptocurrencies under control. As the Korean prime minister said in November, "young people and students are rushing into virtual currency trading to get huge profits in a short period of time." It is time for the government to take action, as it could lead to serious pathological phenomena if it is not controlled ".
Lee, the university student who lost half of his own investments in Bitcoin, says that he is still looking to become a gym teacher, a goal he maintained during the madness. "Money is not the only thing in life," he says.
Oh and her husband are now looking for more stable investments so that one day they can buy a house. "I do not think many people would think they would have a luxury life, riding a yacht and traveling the world," says Oh. "People just wanted to buy a house, that's why they were getting so crazy"
