- A report by DeSpread Research highlights the findings of a survey conducted by the Korea Financial Intelligence Unit (KoFIU).
- The DeSpread Research report emphasizes that South Korean traders are showing significant interest in altcoins, especially those with high profit potential.
- While centralized exchanges’ trading volumes have been declining globally since March, local South Korean exchanges like Upbit have challenged this trend.
Despite significant increases in Bitcoin and Ethereum prices and demand, DeSpread Research suggests that South Korean investors are opting for altcoins.
Korean Investors Now Prefer Altcoins
In South Korea, crypto investors are showing a strong preference for altcoins like Tron over major cryptocurrencies like Bitcoin and Ethereum. Investors are particularly drawn to Tron due to its high profit potential, despite the associated high risk.
A report prepared by DeSpread Research draws attention to the findings of a survey conducted by the Korea Financial Intelligence Unit (KoFIU). This report predicts that over six million people, representing more than 10% of South Korea’s population, will become crypto investors by the first half of 2023.
However, a significant portion of these investors uses centralized exchanges for crypto transactions, indicating the influence of these exchanges on South Korea’s crypto market. The DeSpread Research report highlights the significant interest of South Korean traders in altcoins, especially those with high profit potential.
As a result, this trend indicates that the trading volume for major cryptocurrencies like Bitcoin, Ethereum, and Polygon on South Korean exchanges is relatively lower compared to global trends.
South Korea offers unique regional differences in blockchain networks. The preference for Tron is driven by its network’s lower transaction fees. This preference reflects the preferences and strategies of private investors in the South Korean market.
Local Exchanges Outperform Global Competitors
While the trading volume of centralized exchanges has been declining globally since March, local South Korean exchanges like Upbit have defied this trend. Upbit, the country’s largest exchange, has surpassed market leaders like Binance in terms of trading volume by July.
Upbit dominates South Korea’s crypto market, accounting for an impressive 80% of the trading volume. Bithumb ranks second, sharing 15-20% of the market, while Coinone and Korbit have limited presence in the market.
This increase in trading volume can be attributed to the positive impact of Ripple’s decision to sue the U.S. Securities and Exchange Commission. This decision significantly boosted XRP’s price and trading volume. Despite the resurgence in trading volume on South Korean exchanges, local traders still rely on overseas platforms to store their digital assets. A September report from the national tax service indicates that South Korean investors hold approximately $99 billion worth of digital assets abroad.
