The value of cryptocurrencies held by South Korean investors has fallen by more than half over the past year as declining digital asset prices and tighter regulations weigh on market activity.
Holdings across the country’s five major exchanges – Upbit, Bithumb, Korbit, Coinone and Gopax – dropped to KRW 60.6 trillion ($41.4 billion) by the end of February 2026, down from KRW 121.8 trillion ($83.3 billion) a year earlier.
Trading activity also weakened significantly. Daily transaction volumes on major platforms declined to roughly $3 billion in February from $11.6 billion in December 2024. Won-denominated deposits held at exchanges also fell sharply, signaling reduced investor participation as capital shifted toward South Korea’s booming stock market.
Stablecoins were one of the few areas showing resilience. Holdings increased dramatically during 2024 before easing modestly in early 2026, remaining far more stable than the broader crypto market.
The downturn comes as regulators prepare stricter anti-money laundering rules scheduled to take effect in August. The measures would automatically flag crypto transfers above KRW 10 million involving overseas exchanges or private wallets as suspicious transactions.
Industry association DAXA has criticized the proposal, warning it could overwhelm exchanges with compliance obligations and push traders toward offshore platforms such as Binance. Debate is also intensifying over the government’s planned 22% tax on cryptocurrency gains, which authorities confirmed will begin on Jan. 1, 2027.
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