South Korean cryptocurrency exchanges recorded a 15.6% decline in trading volumes month-over-month despite Bitcoin's rebound, according to data compiled from CoinGecko covering May 1-25. The five major KRW-based exchanges - Upbit, Bithumb, Coinone, Korbit, and Gopax - registered daily average trading volume of approximately 611.9 billion KRW during this period, while KOSPI's daily average reached approximately 36.57 trillion KRW. Industry sources attributed the decline to Bitcoin price formation now centered around US spot ETFs rather than domestic retail participation. This trading downturn occurred as KOSPI experienced high volatility, attracting tens of trillions of KRW in daily transactions and drawing investor attention away from crypto markets.
Korean Crypto Exchanges Record 611.9 Billion KRW Daily Average
During May 1-25, the five major KRW-based exchanges registered cumulative trading volume of 15.29 trillion KRW, down from 18.12 trillion KRW in the same period of the previous month. Daily average trading volume decreased from 725.1 billion KRW to 611.9 billion KRW, a reduction of approximately 113.2 billion KRW. Crypto trading volume represented 1.7% of KOSPI's trading value during the same period.
The first two days of the month showed temporary activity increases, with May 1 and 2 recording 1.78 trillion KRW and 1.82 trillion KRW respectively. These two days alone accounted for 3.60 trillion KRW, representing 23.6% of the month's total trading volume. From May 3-25, trading volume decreased 30.0% compared to the previous month's equivalent period.
Bitcoin Rebounds 15% While Domestic Trading Volumes Contract
Bitcoin rebounded approximately 15% from its early-month low point and briefly exceeded $66,000, yet this price increase did not translate into domestic trading volume recovery. An industry source stated, "Recent Bitcoin price increases have been centered around US spot ETFs, and this hasn't led to increased trading by domestic retail investors. Even if prices rise, there are limits to trading volume recovery if new investors and capital don't enter."
The contrast with KOSPI was notable. While Bitcoin maintained relatively stable price ranges, KOSPI experienced significant fluctuations that attracted short-term trading demand. Another industry source explained, "As KOSPI volatility expanded recently, there's been a shift in attention from investors who prefer short-term trading toward the stock market. Excluding Bitcoin's price rebound, the crypto market lacks new themes capable of attracting investor trading."
Industry Sources Link Decline to US ETF Dominance and KOSPI Volatility
Bitcoin's reduced volatility was identified as another factor behind the trading slump. The cryptocurrency's movement within relatively stable ranges weakened the incentive for short-term profit-seeking traders compared to the past. Industry sources noted that US spot ETF-driven price formation has created a market structure where domestic retail participation no longer correlates with price movements as it previously did.
An industry source stated, "In a market where only Bitcoin is rising, it's difficult for domestic trading volume to increase significantly." The source added that exchanges' revenue dependence on trading fees means volume decreases directly impact sales, with smaller exchanges facing greater pressure due to limited capital and user bases.
FAQ
What was the trading volume decline for Korean crypto exchanges in May?
The five major KRW-based exchanges recorded a 15.6% decline in cumulative trading volume, from 18.12 trillion KRW (previous month, May 1-25) to 15.29 trillion KRW (current month, same period). Daily average trading volume decreased from 725.1 billion KRW to 611.9 billion KRW.
Why did Korean crypto trading volumes decline despite Bitcoin's rebound?
Industry sources attributed the decline to Bitcoin price formation now centered around US spot ETFs rather than domestic retail participation. Bitcoin rebounded approximately 15% and briefly exceeded $66,000, but this did not translate into increased domestic trading activity. Additionally, KOSPI's high volatility attracted investor attention away from crypto markets.
