South Korean Crypto Exchanges Surge With 80% Local Trading Volume

Key Points:

• South Korean crypto exchanges saw a surge in registrations, with altcoins dominating over 80% of local trading volumes.
• Due to regulatory delays in spot Bitcoin ETFs, South Korean investors are turning to foreign ETFs linked to Bitcoin and Ether.

According to Bloomberg, despite periods of market turbulence, including the 2022 crypto winter, South Korea’s enthusiasm for digital assets remains robust.

Read more: Crypto in South Korea Set for Corporate Account Launch by 2025

South Korean Crypto Exchanges Reach New Heights

Over 7 million population of kimchi land are registered on South Korean crypto exchanges. This widespread interest has roots in Bitcoin’s meteoric rise, with a five-year rally exceeding 1,200%, greatly outpacing the 20% return of the Kospi index.

Smaller, riskier altcoins have become the new game in town for investors who missed Bitcoin’s early growth, dominating over 80% of local trading volumes. This is partly fueled by promotional strategies from South Korean crypto exchanges.

Simon Kim, CEO of Korea-based crypto venture firm Hashed, also mentioned how Bithumb‘s zero-fee campaign increased its market share above 30% and gained massive interest from investors.

Meanwhile, regulatory reluctance over spot Bitcoin ETFs in South Korea has pushed investors to overseas options. Data from the Korea Securities Depository shows highly leveraged ETFs tracking Bitcoin proxy MicroStrategy and Ether were among the top 10 most-bought foreign securities by Koreans last month.

Economic Hardships Trigger Risky Investments in Digital Assets

Investment behaviour will largely be determined by economic uncertainty and a number of geopolitical considerations. South Korea also stands as possibly one of the most trade-dependent countries in the world. Therefore, not surprisingly, there is much to fear concerning the ongoing policies of former US President Donald Trump, from proposed tariffs on Chinese goods to increased defence cost-sharing demands on South Korea.

Tension has also been fueled by the unexpected interest rate cut recently announced by the Bank of Korea, and Governor Rhee Chang-yong has expressed an apprehensive view about how changes in U.S. politics will even impact global trade.

Under these conditions, South Korean investors are becoming increasingly inclined to take the plunge into the risky world of highly rewarding and high-risk investments in cryptocurrency as a cushion against prevailing economic uncertainties.