South Korea’s Crypto Trading Volume Plummets 54.6% in First Half of 2026

Significant Decline in Trading Volume

In the first half of 2026, trading volume across South Korea’s five major won-based cryptocurrency exchanges fell by 54.6% compared to the same period last year, highlighting a marked decrease in market activity. The total trading volume amounted to $366.58 billion, as reported by NexBlock.

Market Leader’s Share Increases

Despite the overall drop in trading volume, Upbit – South Korea’s leading crypto exchange – managed to increase its market share to 67.4% in July 2026, even as its own trading activity declined by 10% during that month. In contrast, Bithumb, the second-largest exchange, saw its market share decrease from 30.7% to 27.1%.

Market Dynamics and Concentration of Liquidity

The shift in market share is attributed to a concentration of liquidity on larger exchanges amid a broader market slowdown. According to NexBlock, deep liquidity at major exchanges enables them to attract more traders by facilitating larger orders with less price slippage. This trend has heightened the competitive pressure on smaller platforms like Coinone, Korbit, and Gopax, which may need to develop new business strategies to survive.

Upcoming Tax Changes Impacting the Market

Adding to the challenges, South Korea is set to implement a 22% tax on crypto gains starting January 1, 2027. This tax will apply to annual gains exceeding 2.5 million won (approximately $1,740), with Finance Minister Koo Yun-cheol affirming the government’s commitment to this initiative. Investors below the threshold will be exempted from taxes, but the impending regulations may further alter trading behaviors and exchange volume.

Future Outlook for Exchanges

As the trading volume continues to decrease, smaller exchanges are encouraged to explore partnerships with securities firms, institutional services, and restructure their operations. Their future success may rely more on stablecoin liquidity and regulatory compliance than on mere volume figures, as traditional financial collaboration becomes crucial.

Conclusion

The crypto landscape in South Korea faces a significant transition, with evolving regulatory frameworks and shifting market dynamics. While Upbit fortifies its position, the other exchanges will need to adapt quickly to retain traders’ interest and ensure their relevance in a competitive market.