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Photo courtesy of Yonhap News |
[Alpha Biz= Paul Lee] Trading volumes at South Korea’s two largest cryptocurrency exchanges, Upbit and Bithumb, are continuing to decline, raising concerns that profitability may deteriorate this year as investor sentiment in the crypto market remains weak.
According to CoinGecko on March 12, Upbit’s 24-hour trading volume stood at $968 million as of 3 p.m., while the average daily volume this month was $1.31 billion, down more than $500 million from last month’s $1.89 billion.
Bithumb also reported sluggish activity, with daily trading volume reaching $432 million, remaining below $500 million for six consecutive days since March 7. Its average trading volume fell from $826 million last month to about $527 million this month.
The decline is largely attributed to weak investor sentiment following falling cryptocurrency prices. On the same day, Bitcoin traded at 102.04 million won, down 42.6% from its all-time high of 178.01 million won recorded on Oct. 8 last year. Although the price has recovered above 100 million won this month, upward momentum remains limited.
Some users have also shifted to rival exchanges such as Coinone and Korbit, which are offering zero trading fees for USD Coin (USDC) transactions.
Given that 97–98% of revenue at the two exchanges comes from trading fees, analysts expect earnings pressure to continue. Upbit has already moved to reduce its dividend, proposing a cash dividend of 5,827 won per share for 2025 at its March 31 shareholders’ meeting, down 33.6% from the previous year’s 8,777 won.
Bithumb may face even greater earnings pressure. In addition to falling trading volumes, the exchange has been waiving fees following a recent Bitcoin overpayment incident and covering related recovery costs, while continuing aggressive discount marketing campaigns.
Further risks remain as the Financial Supervisory Service (FSS) recently completed an on-site inspection into the Bitcoin overpayment case. Authorities are expected to decide on possible penalties after an internal review, which could add to Bithumb’s financial burden.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
