Operating profits at South Korea’s cryptocurrency exchanges fell nearly 78% in the first half of 2026 as
lower bitcoin prices,
weaker trading activity, and
a shift of retail investors into domestic equities
squeezed one of the world’s largest digital asset markets.
MARKET ANALYSIS | ‘There is No Retail Interest in Crypto Right Now,’ Say Analysts
Data released by South Korean financial regulators showed the total value of crypto assets held on domestic exchanges fell 33% to 58.9 trillion won ($42 billion) by the end of June 2026, down from 87.2 trillion Won at the end of 2025. Average daily trading volumes also declined to 3.1 trillion Won from 5.4 trillion Won over the same period.
Data collected from VASPs in South Korea shows average daily trding volume was down 44% and total deposits in Korean Won was down 35% in H1 2026.#CryptoKR #CryptoSouthKorea #CryptoAsia #CryptoReality pic.twitter.com/0QKrwqnrYQ
— BitKE (@BitcoinKE) October 2, 2026
The drop in exchange earnings reflects the structure of South Korea’s crypto market where trading fees remain the main source of revenue. When prices fall and retail activity slows, exchange profits can contract sharply.
Bitcoin’s decline during the first half of the year weighed heavily on sentiment while expectations for interest rate cuts faded amid inflation concerns and global economic uncertainty making investors more cautious toward risk assets.
REALITY CHECK | Bitcoin Still Trading 50% Below All-Time High Over Half a Year Later
At the same time, South Korean retail investors shifted capital into a booming domestic stock market, particularly AI-related shares and leveraged exchange-traded products tied to companies such as Samsung Electronics and SK Hynix.
That stock-market frenzy diverted trading volumes away from cryptocurrencies.
REALITY CHECK | South Korea Crypto Trading Volumes Collapse by ~90% YoY as Stock Market Outperforms Digital Assets
Major exchanges such as Upbit and Bithumb reported revenue declines of around 50% with Bithumb posting losses partly due to lower trading income and markdowns on crypto holdings. Customer deposits on exchanges also fell indicating investors were committing less capital to digital assets.
The slowdown highlights a broader reality for crypto exchanges globally where, despite growing institutional adoption and regulatory progress, exchange earnings remain closely tied to market cycles. During periods of lower volatility and declining prices, retail trading activity, which is the industry’s primary revenue engine, can dry up quickly.
REALITY CHECK | Why Protocols Generating Over $10 Million in Monthly Fees Fell by Half YoY in H1 2026
Stay tuned to BitKE on key crypto developments in Asia.
Join our WhatsApp channel here.
Follow us on X for the latest posts and updates
Join and interact with our Telegram community
_________