- Retail investors drive South Korea’s rise in global crypto market
- A young demography reshaping South Korea’s crypto landscape
- Upcoming regulations signal proactive approach to crypto oversight
In a recent Bloomberg Crypto report, South Korean retail investors are credited with fueling the surge in local digital asset exchanges, predating the global crypto boom that pushed prices to record highs earlier in 2024.
The Korea Financial Intelligence Unit (KOFIU) revealed a significant uptick in crypto participation, with active users on registered exchanges surging by 390,000 to 6.45 million by year-end 2023.
This surge in activity is particularly noteworthy, representing over 10% of the country’s total population, according to reports. The majority of these investors, categorized as “individual” investors, fall within the 30-40 age range, comprising nearly 60%.
Daily average crypto trading volume in South Korea also witnessed a substantial increase of 24%, reaching 3.6 trillion won ($2.6 billion) during the same period. This trading activity surge paralleled a remarkable 53% increase in the total value of crypto held by registered exchanges, reaching 43.6 trillion won.
These figures underscore South Korea’s growing importance in the global crypto landscape. The South Korean Won (KRW) emerged as the most-used currency for crypto trading in the first quarter of 2024, surpassing even the US dollar. Upbit, the biggest exchange in the country, is often in the top five global trading exchanges.
KOFIU attributed the surge in various metrics, including trading volume, market capitalization, exchange operating income, and Korean won deposits, to the rise in crypto prices and a rebound in investor sentiment.
Despite the recent collapse of TerraUSD, a stablecoin developed by South Korean native Do Kwon, the country’s crypto enthusiasm remains resilient. This resilience is further evidenced by a major political party’s campaign pledge to grant Koreans access to US Bitcoin ETFs during the recent parliamentary election.
Looking ahead, South Korea is poised to implement the Virtual Asset User Protection Act in July, introducing stricter regulations for exchanges and harsher penalties for wrongdoing in the sector.
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