6 Million Investors and the Rise of Centralized Exchanges (Survey)

South Korea has emerged as a global hotspot for cryptocurrency investment in recent years, according to a recent survey, with six million crypto investors representing over 10% of the country’s total population.

This phenomenon has reshaped the financial landscape and highlighted the dominance of centralized exchanges in the Korean crypto market.

A Closer Look at Korean Exchanges

According to a survey conducted by the Korea Financial Intelligence Unit (KoFIU), the number of crypto investors in the country is projected to reach approximately six million in the first half of 2024, representing over 10% of the country’s total population.

The majority of these investors primarily engage in investment activities centered around centralized exchanges.

South Korean cryptocurrency exchanges have demonstrated resilience despite a global decrease in trading volume since March. Market volatility has decreased, with Bitcoin maintaining a relatively stable range of $27K to $28K for six months.

Following a peak of $45 billion in February, Korean exchanges experienced a dip to $23 billion in May but rebounded to $37 billion in July, surpassing Binance.

These Korean exchanges have maintained trading volumes at around 10% compared to Binance and have even exceeded Coinbase’s numbers, underscoring their growing influence in the international market.

The dominant player in the Korean crypto market is Upbit, which recorded its highest trading volume of $36 billion in February, accounting for approximately 80% of the Korean crypto exchange market.

Bithumb, the second-largest exchange, maintains a strong position with a market share of 15% to 20%. The market share of Coinone and Korbit is relatively limited.

Korean Investors Favor Altcoins, Loom Network Leads

Korean investors have distinct preferences when it comes to cryptocurrencies. Loom Network (LOOM) recorded the highest trading volume among Korean investors, with a ratio of 62%, followed by eCash (XEC) at 55% and Flow (FLOW) at 43%.

Stacks (STX) and Bitcoin SV (BSV) also made the list with ratios of 37% and 34%, respectively. This shows a preference for altcoins over mainstream coins among Korean investors.

Although trading volumes for BTC and ETH on Upbit make up a small proportion of the total, Coinbase, a major U.S. cryptocurrency exchange, holds a significant share of volume in these cryptocurrencies.

This suggests contrasting investment strategies across markets, with Upbit’s investors demonstrating a keen interest in altcoins with high-profit potential, while Coinbase’s institutional investors prioritize portfolio stability.