South Korea Tops East Asia in Crypto Adoption with $449 Billion Market

South Korea remains the dominant force in East Asia's cryptocurrency market, according to a new report from Chainalysis released on October 5. The country's crypto economy grew to $449.1 billion between July 2025 and June 2026, a 12.3% increase from the previous period. This growth was driven primarily by retail trading activity, with local platforms adding $51.1 billion in new traffic and overall ecosystem-related activities rising by 16.3%. South Korea now ranks first in East Asia and fifth globally in grassroots adoption.

The report highlights structural changes in South Korea's crypto market, particularly the rise of AI tokens. By June 2026, AI-related crypto assets had become the largest thematic sector in KRW trading, surpassing payment tokens like XRP. Worldcoin led the trading volume with $7.41 billion, followed by SAHARA, VIRTUAL, BIO, and NEAR. KRW trading of AI tokens was approximately 19.5 times higher than in the JPY market.

Hong Kong's crypto market reached $192.2 billion, with institutional platform inflows growing by 87% year-on-year. Institutional settlements accounted for 16% of service inflows, nearly three times higher than other regional markets. Japan's market, valued at $228.3 billion, saw decentralized exchanges account for 34.5% of service activities, with retail participation on these platforms expanding by 36%. In mainland China, the use of stablecoins between peer-to-peer wallets increased 43-fold, focusing on transfers rather than trading thematic coins.

The report notes that South Korean institutions are still in the preparatory stage, with banks and brokerages forming digital asset teams to promote stablecoin, custody, and tokenization pilots. However, direct market entry by enterprises has not yet scaled. The report suggests that the implementation of crypto asset income tax in 2027 and easing trading restrictions for enterprises may reassess the current retail-dominated landscape.