Korean Crypto Volumes Slump Amid Stock Market Rally

South Korean cryptocurrency exchanges are seeing steep declines in trading volumes, as capital shifts toward the domestic stock market. According to data from CoinGecko, average monthly volume across the country's five largest crypto platforms fell by 34% in June from the previous month, landing at 3.17 trillion won ($2.3 billion). Compared to January, this represents a staggering 71% drop.

This reversal in trading momentum follows the inauguration of President Lee Jae Myung on June 4. His administration has prioritized revitalizing the domestic equities market, introducing investor-friendly reforms that have helped lift the KOSPI to its highest point in nearly four years.

Despite Bitcoin reaching a record high of $112,000 this week, overall investor participation appears to be waning. A report from Matrixport pointed out, "The market is clearly in need of a new catalyst, and for now, many retail investors seem to have checked out for the summer."

To offset falling revenue, exchanges are pivoting to alternative business models. Coin lending services - which allow users to borrow digital assets using their existing holdings as collateral - are gaining traction. For example, Upbit's lending platform supports Bitcoin, Tether, and Ripple, offering up to 80% of the collateral value and charging a usage fee every eight hours. Bithumb's service allows borrowing of up to four times the collateral value, but is restricted to users with at least 10 million won in prior monthly trading volume.

These offerings reflect a broader effort among South Korean exchanges to remain viable as traditional trading activity tapers off in favor of more regulated and incentivized investment environments.