AI Tokens Catapult South Korea to Top of East Asia's Crypto Market

South Korea's crypto market surged to the top of East Asia, driven by heavy retail investment in AI-focused tokens. From July 2025 to June 2026, the market hit a record $449.1 billion in volume, growing 12.3% year-over-year. This outpaced Japan ($228.3 billion), Hong Kong ($192.2 billion), China ($176.3 billion), and Taiwan ($140.4 billion). The rise was fueled by centralized exchanges, which saw a 16.3% volume increase, though institutional participation remained limited due to regulatory hurdles.

The Korean market's growth was notably powered by AI tokens, which became the largest thematic trading category. By June 2026, trading volumes in AI cryptocurrencies against the Korean won were 19.5 times higher than those in Japanese yen. Popular tokens included Worldcoin (WLD) with $7.41 billion in volume, SAHARA ($3.2 billion), VIRTUAL ($2.7 billion), BIO ($2 billion), and NEAR ($1.7 billion). Retail traders in South Korea rotated between AI assets more actively than in other markets.

Japan's crypto market, the second-largest in the region, stood out for its high activity on decentralized exchanges (DEX), which accounted for 34.5% of the services segment. DEX activity in Japan surged over 200% since 2022, while centralized exchange usage remained stable. Meanwhile, Hong Kong emerged as the region's main institutional crypto hub, with institutional platforms driving 16% of inflows into the city's services segment.

In China, despite a ban on crypto services, peer-to-peer (P2P) transactions dominated, making up 59.1% of the crypto economy. The number of unique wallets sending stablecoins between users increased 43-fold from Q1 2024 to Q2 2026. South Korea plans to pass a digital assets law in the second half of 2026, potentially shaping future market developments.