South Korea's Crypto Market Surges on AI Token Demand
South Korean retail traders have extended their enthusiasm for AI stocks into the cryptocurrency market, according to Chainalysis data. AI tokens have become the dominant theme in won-denominated trading, with Worldcoin (WLD) leading the pack, generating $7.41 billion in trading volume over the past year. This surge in demand has contributed to a 12.3% growth in South Korea's crypto economy, reaching $449.1 billion, despite a modest contraction in East Asia's broader crypto market. Retail traders are primarily driving this growth, while Korean banks and institutions remain largely on the sidelines, still in pilot mode.
The report highlights that AI tokens' share of won trading was 19.5 times higher than their share of yen trading, and significantly larger compared to other major currencies like the euro, British pound, and Brazilian real. Chainalysis attributes this trend to Korean retail traders' preference for high-risk, high-reward investments. This aligns with their stock market behavior, where AI-related stocks like SK Hynix have seen increased trading volumes.
Worldcoin emerged as the top AI token in South Korea, with $7.41 billion in trading volume, more than double that of the next highest, Sahara AI (SAHARA), which recorded $3.2 billion. Other notable AI tokens included Virtuals Protocol (VIRTUAL) with $2.7 billion, Bio Protocol (BIO) with $2 billion, and NEAR Protocol (NEAR) with $1.7 billion. The AI crypto sector also outperformed the broader market in September, with a 54% rise compared to the market's 24% gain. Worldcoin's price has seen a 44.28% increase over the past month, although it remains about 95% below its March 2024 record of $11.74.
Looking ahead, the supply side of Worldcoin is set to ease, with daily WLD unlocks expected to fall 43% from July 24 to about 2.9 million tokens. However, a potential challenge looms with South Korea's planned 22% tax on crypto gains starting January 2027, which could impact demand. Additionally, Korean traders are known for quickly rotating their investments, with 2025's leading AI tokens like VIRTUAL and KAITO already being replaced by WLD and SAHARA. These factors could influence whether Worldcoin maintains its leading position among South Korean AI token investors.