2024

April

Terra

A recent report revealed that the South Korean exchange Upbit dominates the local crypto market with over 80%. Additionally, Upbit rose to fifth place in the top five global exchanges list. 
Different platforms have unsuccessfully challenged the exchange’s dominance in the country, and the upcoming regulatory framework has affected them. 
<h2 id="upbit-enters-the-top-five-global-crypto-exchange-list">Upbit Enters The Top-Five Global Crypto Exchange List</h2> 
News media outlet Bloomberg <a href="https://www.bloomberg.com/news/articles/2024-04-25/korean-crypto-boom-upbit-is-now-a-top-global-exchange-by-volume" target="_blank" rel="noopener nofollow">reported</a> on Upbit’s latest feat after eclipsing the Korean market. The reining Korean exchange holds over 80% of the country’s trading volume. 
<blockquote class="twitter-tweet" data-width="500" data-dnt="true"> 
 Upbit, the largest crypto exchange in South Korea, accounts for more than 80% of the trading volume in the country. The exchange has become one of the top five largest exchanges in the world in terms of trading volume, moving closer to Coinbase – BBG <a href="https://t.co/f5jzHTBPIP" rel="nofollow" target="_blank">pic.twitter.com/f5jzHTBPIP</a> 
 — NekoZ (@NekozTek) <a href="https://twitter.com/NekozTek/status/1783409293758218524?ref_src=twsrc%5Etfw" rel="nofollow noopener" target="_blank">April 25, 2024</a>
</blockquote> 
Notably, Upbit’s dominance level hasn’t been accomplished by other exchanges on any prominent crypto hub. According to official numbers cited by Bloomberg, over 6 million Koreans, around 10% of the population, traded cryptocurrencies in the first half of 2023. 
The increase in volume during this bull run has propelled the exchange to the fifth spot among the global exchanges. Upbit’s $2.84 billion daily trading volume runs neck-and-neck with Coinbase’s $2.86 billion. 
According to the report, South Korean exchange transactions accounted for almost a fifth of its banking partners’ total deposits last year. Similarly, altcoins <a href="https://bitcoinist.com/south-koreas-crypto-shift-million-investors-rally/" target="_blank" rel="noopener ">account</a> for 80% of Korean exchanges’ trading volume, while global platforms register a much smaller volume, with 50%. 
Despite the looming shadow of Do Kwon and Terra Labs’ $40 billion meltdown, the Korean market continues to grow and become a market with the “keenest crypto traders with a taste for high-risk, high-reward tokens” in the world. 
Moreover, recent <a href="https://bitcoinist.com/south-korean-won-takes-the-lead-in-crypto-trading/" target="_blank" rel="noopener ">reports</a> revealed that the South Korean Won surpassed the American dollar as the leading currency for crypto trades globally in Q1,2024. The surge suggests a massive appeal and increasing popularity for crypto among South Koreans. 
As a result, campaigns for the upcoming elections tried to attract voters, with candidates <a href="https://bitcoinist.com/spot-bitcoin-etfs-coming-south-korea-ruling-party/" target="_blank" rel="noopener ">promising</a> to work on regulations and taxes. 
<h2 style="font-weight: 400;" id="does-the-new-regulatory-framework-favor-upbit-s-dominance">Does The New Regulatory Framework Favor Upbit’s Dominance?</h2> 
South Korean regulators will implement the Virtual Asset User Protections Act in July 2024. The new regulatory framework will implement stricter requirements and consequences on exchanges, including potential life sentencing for criminal acts. 
Moreover, operators must “take steps to meet liabilities” after hacks or system failures. The requirements demand both significant “capital and manpower,” according to Nam Hyeon Joon, a spokesperson for Korea’s second-largest exchange, Bithumb. 
The new <a href="https://bitcoinist.com/south-korea-fiu-crypto-regulatory-landscape/" target="_blank" rel="noopener ">regulatory landscape</a> was “designed to protect investors” after the Terra Labs collapse, but it has affected smaller exchanges. Platforms like Huobi Korea, Cashierest, and Coinbit have shut down since the bill was passed last year. 
Simon Seojoon Kim, CEO of the Venture Capital firm Hashed, believes that well-resourced crypto exchanges like Upbit will make it easier to meet the requirements. “For existing and new entrants, the cost of complying with these requirements could be substantial,” stated Kim. 
Korbit Research analyst Min Seung Kim concurs with the sentiment, adding that the <a href="https://bitcoinist.com/south-korean-crypto-exchange-ceo-gets-7-years/" target="_blank" rel="noopener ">competition</a> will be limited as trading remains “increasingly focused on the top exchange.” 
Platforms trying to compete with Upbit’s dominance have gone into zero-fee campaigns. According to the report, Bithumb briefly challenged Upbit after reaching a market share peak of 39.2% in January. However, the share dropped by more than half after its promotion ended. 
Ultimately, entering the South Korean crypto market continues to be difficult. As recently seen with Crypto.com, complying with the country’s regulatory requirements requires a defined strategy and vast resources. 
<img loading="lazy" decoding="async" class="size-large wp-image-296701 aligncenter" src="https://bitcoinist.com/wp-content/uploads/2024/04/TOTAL_2024-04-25_08-35-27.png?w=980&amp;resize=980%2C468" alt="TOTAL, Crypto " width="980" height="468" srcset="https://bitcoinist.com/wp-content/uploads/2024/04/TOTAL_2024-04-25_08-35-27.png?w=1077 1077w, https://bitcoinist.com/wp-content/uploads/2024/04/TOTAL_2024-04-25_08-35-27.png?w=640 640w, https://bitcoinist.com/wp-content/uploads/2024/04/TOTAL_2024-04-25_08-35-27.png?w=768 768w, https://bitcoinist.com/wp-content/uploads/2024/04/TOTAL_2024-04-25_08-35-27.png?w=980&amp;resize=980%2C468 980w, https://bitcoinist.com/wp-content/uploads/2024/04/TOTAL_2024-04-25_08-35-27.png?w=750 750w" sizes="(max-width: 980px) 100vw, 980px" data-recalc-dims="1">

Crypto Market Dominance: Upbit Handles 80% Of South Korean Trading Volume

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