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South Korea’s frenetic cryptocurrency trading sets the scene for Bitcoin’s record
(Bloomberg) — South Korean retail investors flocked to local digital asset exchanges in large numbers well before the global cryptocurrency boom that pushed prices to record levels in early 2024.
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According to the semi-annual crypto-asset activity report released by the Korea Financial Intelligence Unit (KOFIU), active users of registered exchanges in the country increased from 390,000 to 6.45 million by the end of 2023.
Of these users, who represent more than 10% of the country’s total population, 99% identify themselves as “individual” investors and almost 60% of them were between 30 and 40 years old. The average daily cryptocurrency trading volume in the country grew 24% to 3.6 trillion won ($2.6 billion) in the period, while the total value of cryptocurrencies held by registered exchanges increased 53% to 43 .6 trillion won.
The report highlights how vital South Korea has become as a growth body in global cryptocurrency markets. The South Korean won was the most traded currency against crypto-assets globally in the first quarter of 2024, beating the US dollar. Upbit, the dominant exchange in the country, has at times ranked among the top five in the world by trading volume.
Read more: Upbit brings Korean cryptocurrency boom into top five global exchanges
“Trading volume, market capitalization, trading operating income, Korean won deposits all increased compared to the first half due to rising cryptocurrency prices and recovering investor sentiment,” KOFIU said in a note. “The number of users trading cryptocurrencies increased compared to the first half of 2023,” the institute added.
Even after the collapse of TerraUSD, the ill-fated stablecoin created by South Korean native Do Kwon, such is the enthusiasm for cryptocurrencies in the country that a major political party has pledged to grant Koreans access to US Bitcoin ETFs during parliamentary elections last month.
From July, South Korean regulators will introduce the Virtual Asset User Protection Act, imposing tough new requirements on exchanges and harsher punishments for wrongdoing in the sector.
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