South Korea crypto exchanges report H1 profit slump amid weaker trading activity
South Korea's crypto trading market is slowing in the first half of 2026 as exchange activity, asset values and customer deposits retreat. The pullback comes as local retail investors show signs of shifting capital toward the country's stock market.
Highlights
- South Korean crypto exchanges' operating profits drop 78% in H1 2026 versus prior six months as trading activity weakens, per KoFIU.
- Average daily trading volume falls 44%, market capitalization declines 33%, and won-denominated deposits decrease 35% across 26 surveyed virtual asset providers.
- Retail investors shift capital to equities, with value of crypto held falling 50.2% to 60.6 trillion won, while KOSPI more than doubles year-over-year to July 22.
KoFIU data shows broad exchange slowdown
As reported by Cointelegraph, citing the Korea Financial Intelligence Unit, operating profits at South Korean crypto exchanges fall 78% in the first half of 2026 from the previous six months as trading activity weakens across the sector.On Thursday, KoFIU says average daily trading volume at domestic virtual asset exchanges falls 44%, while market capitalization declines 33% and won-denominated deposits drop 35%. Exchange sales also decline 41%, even as the number of accounts eligible to trade edges up 0.4%.
The survey covers 26 registered virtual asset service providers, including 17 exchange operators and nine custody and wallet providers, and tracks activity from Jan. 1 through June 30.
Retail flows shift toward equities
Recent market data points to a broader reallocation by South Korean retail investors away from digital assets and toward equities. In May, the value of crypto held by South Korean investors falls 50.2% to 60.6 trillion won, or $41.4 billion, over roughly a year.ChosunBiz links that decline to capital moving into stocks. A Cointelegraph analysis published in July also finds that combined average daily volume across Upbit, Bithumb, Coinone, Korbit and Gopax falls about 89% year over year during comparable seven-day periods, while the KOSPI, South Korea's benchmark stock index, more than doubles over the 12 months to July 22.
Cointelegraph says it contacts Bithumb and Upbit operator Dunamu for comment.
Our earlier coverage of South Korea’s September inflation detailed how CPI cooled into the 2% range as government price caps and lower agricultural costs helped ease headline pressures. The piece also noted that energy-linked categories such as petroleum products and diesel were still rising sharply, keeping transport and other costs elevated despite the broader slowdown.
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