South Korea’s cryptocurrency market appears to be experiencing a mix of growth and stress, according to the latest figures from the nation’s leading financial regulator.
A report from the Financial Services Commission indicated that about $60 billion in cryptocurrency assets were transferred out of domestic cryptocurrency exchanges and into international platforms and private accounts in the second half of 2025.
The regulator said total outflows reached 90 trillion won ($60 billion) between July and December, marking a 14 percent increase from the first half of the year.
What’s behind the movement?
According to officials, a great deal of this is attributed to arbitrage, which involves moving funds to different jurisdictions for price, liquidity, and regulatory advantages.
Essentially, this means that users are looking elsewhere for maximum returns or services that are not offered within the home market.
What is even more interesting is that this trend was witnessed even as the domestic market continued to see an increase in user participation.
The number of exchange accounts in South Korea rose to 11.1 million by the end of 2025, up about 3 percent from mid-year levels.
Further, deposits grew even faster, jumping 31 percent to 8.1 trillion won ($5.4 billion). The surge indicates that there is still interest in digital assets, with an increased number of people entering the market which has resulted in a good amount of flow of capital.
Despite an increase in the number of users of these platforms, however, financial results did not improve for crypto exchanges. The country’s 18 operating crypto platforms generated a combined 380.7 billion won ($253.4 million) in operating profit during the second half of 2025. This represents a significant decline of 38 percent from the previous six months. This decline is due to fewer trading activities.
South Korea crypto market cap falls
Market conditions also played a role. The regulator estimated South Korea’s total crypto market capitalization at 87.2 trillion won (about $58 billion) at the end of 2025, down 8 percent from earlier in the year.
Average daily trading volume fell 15 percent to 5.4 trillion won ($3.6 billion) over the same period. These trends have been recorded at a time when the global market was experiencing a slump following a strong rally at the beginning of 2025.
A major milestone was recorded when Bitcoin hit an all-time high of $126,080 in October 2025. The prices, however, decreased due to macroeconomic variables like geopolitical risks from the Middle East and also because of the possibility of an increase in interest rates by the Federal Reserve.
From the trends, it is clear that although the crypto market is growing in South Korea, it is becoming more volatile in terms of profits and trades.
The trends established regarding cross-border transfers showed that it is becoming a globalized market.