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Centralized exchanges lead the way in South Korea’s crypto boom

South Korea

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TL;DR

  • South Korea’s crypto craze: 10% of the population invested, reshaping financial landscape.
  • Centralized exchanges dominate Korean market, defying global volatility.
  • Upbit leads with $36B trading volume, solidifying dominance in South Korea.

A recent survey conducted by the Korea Financial Intelligence Unit (KoFIU) has unveiled a remarkable trend in South Korea’s financial landscape – over 10% of the nation’s population, equating to approximately six million individuals, have ventured into the world of cryptocurrency investment. This surge in crypto enthusiasts has solidified South Korea’s position as a global cryptocurrency hotspot, with far-reaching implications for both the domestic and international markets.

One key revelation of the survey is the pivotal role of centralized exchanges in the Korean crypto market. The majority of South Korean investors are actively participating in the crypto space through these platforms, highlighting their dominance and resilience even amidst global market fluctuations. Notably, the survey predicts that the number of crypto investors in South Korea will continue to rise, potentially reaching six million by the first half of 2024.

South Korean exchanges weather global volatility

Despite the worldwide decrease in trading volume observed since March, South Korean cryptocurrency exchanges have exhibited a surprising level of resilience. Market volatility has decreased, with Bitcoin maintaining a relatively stable trading range of $27,000 to $28,000 over six months.

After reaching its peak trading volume of $45 billion in February, the Korean exchanges saw a dip to $23 billion in May. However, they swiftly rebounded, surpassing Binance with a trading volume of $37 billion in July. This data underscores the growing influence of South Korean exchanges on the international crypto market, holding trading volumes at around 10% compared to Binance and even outpacing Coinbase.

In the competitive arena of South Korean crypto exchanges, Upbit emerges as the dominant player. Upbit recorded its highest trading volume in February, a staggering $36 billion, securing approximately 80% of the market share in the Korean crypto exchange market. Bithumb, the second-largest exchange, maintains a strong position with a market share ranging from 15% to 20%. Meanwhile, the market share of Coinone and Korbit remains relatively limited, making them minor players in this dynamic landscape.

South Korean investors embrace altcoins

Korean crypto investors exhibit distinctive preferences when it comes to cryptocurrencies. Loom Network (LOOM) has taken the lead among Korean investors, boasting a trading volume ratio of 62%. It is closely followed by eCash (XEC) at 55% and Flow (FLOW) at 43%. Stacks (STX) and Bitcoin SV (BSV) have also garnered considerable attention, with ratios of 37% and 34%, respectively. This trend underscores a clear preference for altcoins over mainstream cryptocurrencies among Korean investors.

While trading volumes for Bitcoin (BTC) and Ethereum (ETH) on Upbit constitute a relatively small proportion of the total, it is noteworthy that Coinbase, a major U.S. cryptocurrency exchange, maintains a significant share of volume in these cryptocurrencies. This indicates the continued presence of international exchanges in the South Korean market and highlights the diversity of options available to local investors.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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Lacton Muriuki

Lacton is an experienced journalist specializing in blockchain-based technologies, including NFTs and cryptocurrency. He dabbles in daily crypto news rich with well-researched stats. He adds aesthetic appeal, adding a human face to technology.

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