Upbit, the South Korean cryptocurrency exchange, has surged into the top five global crypto exchanges, challenging industry giants like Binance and Coinbase. This rise comes amid a resurgence in Asia’s cryptocurrency markets and despite stringent regulatory measures in South Korea.
Key Takeaways
- Upbit now ranks among the top five global crypto exchanges.
- The Korean Won has become the most-used fiat currency for crypto transactions, surpassing the USD.
- Upbit dominates 80% of South Korea’s crypto trading volumes.
- New regulations in South Korea could further strengthen Upbit’s market position.
- Over 6 million South Koreans engaged in crypto trading last year.
Upbit’s Meteoric Rise
Upbit offers a wide array of cryptocurrencies, making it a dominant player in South Korea’s crypto landscape. The exchange accounts for 80% of the total crypto trading volumes in the country, putting it in direct competition with global players like Coinbase. Interestingly, Binance appears to be losing market share in Asia.
Despite growing regulatory measures in South Korea, Upbit has continued to thrive. Last year, the exchange’s clientele made up nearly a fifth of its primary banking partner’s overall deposits, drawing significant criticism from a South Korean legislator.
Regulatory Landscape
New legislation aimed at safeguarding investors has been introduced in South Korea, following the collapse of TerraUSD in 2022. These regulations require crypto exchanges to bolster reserves, secure investor protection insurance, and intensify surveillance of suspicious transactions. Upbit has already complied by submitting deposits and withdrawals exceeding $1 million.
Earlier this week, Singapore-based Crypto.com postponed its plans to launch in South Korea, citing the need for more time to consult with regulators.
South Korea’s Crypto Enthusiasm
Despite the $40 billion collapse of TerraUSD, South Korean traders remain highly active in the crypto space. Over 6 million Koreans, or more than 10% of the population, engaged in cryptocurrency trading on registered exchanges in the first half of last year.
The widespread interest in crypto has even become a political issue in Seoul. Competing candidates in recent parliamentary elections pledged to postpone taxes on digital assets or ease constraints on investing in US Bitcoin ETFs.
Altcoins, smaller tokens beyond Bitcoin and Ethereum, contribute to 80% of the trading volume on Korean exchanges, compared to around 50% on global platforms. This indicates a strong appetite for high-risk, high-reward investments among South Korean traders.
Conclusion
Upbit’s rise to the top five global crypto exchanges is a testament to its dominance in the South Korean market and the growing interest in cryptocurrencies in the region. As new regulations come into play, it will be interesting to see how Upbit and other exchanges navigate the evolving landscape.
