Korean Crypto Volumes Plummet 54.6%, Retailers Flee to Equities Amid Tax Looms
The Korean crypto market has seen a significant decline in trading volume over the past year. According to NexBlock's H1 2026 exchange data, the five registered cryptocurrency exchanges in South Korea - Upbit, Bithumb, Coinone, Korbit, and Gopax - collectively recorded $366.58 billion in trading volume during the first six months of 2026, a 54.6% year-on-year collapse from the same period in 2025.
The decline accelerated into July, with the five exchanges generating approximately ₩17.34 trillion (approximately $12.1 billion) in trading volume from July 1 through July 27, down 16.9% from the same period in June.
Upbit processed approximately ₩11.69 trillion (approximately $8.2 billion) during this window, a 10% volume decline but an expansion in market share to 67.4%. Bithumb recorded approximately ₩4.71 trillion (approximately $3.3 billion), with its share of the five-exchange market slipping from 30.7% to 27.1%, widening the Upbit-Bithumb gap.
The structural squeeze is more severe for smaller exchanges, such as Coinone, Korbit (now rebranded Digital X after its acquisition by Mirae Asset), and Gopax, with revenue declines exceeding 50% year-over-year in first-quarter 2026 financials. Korbit has reportedly liquidated portions of its cryptocurrency treasury on at least three occasions in 2026 to fund operating expenses.
Korean retail traders retreated from crypto due to the KOSPI equity rally fueled by Samsung and SK Hynix, which became one of the best-performing major equity markets between late 2025 and June 2026. The AI semiconductor supercycle disproportionately benefited these companies, with Goldman Sachs calling Korea its highest-conviction equity market in the Asia-Pacific region.
The 22% crypto gains tax, confirmed to proceed without delay on July 29 by Finance Minister Koo Yun-cheol, is a major short-term driver of the offshore-exit question. The enforcement asymmetry compounds the risk, as Korean crypto traders under the current design cannot carry forward losses to offset against future gains.