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Regulation & Policy · 2 min read

South Korea Crypto Exchange Profits Plunge 78% in First Half of 2026

Regulatory survey finds domestic market cap fell by KRW28.3 trillion as trading volumes and operator revenue slumped across 26 licensed VASPs.

Editorial oversight: Julian Mercer, Chief Editor
Bearish

At a glance Guidance

What happened
South Korean regulators released an H1 2026 survey showing domestic crypto exchange operating profits fell 78% alongside sharp drops in trading volume and deposits.
Why it matters
The findings underscore steep revenue declines for licensed venues and extreme volume concentration in fiat-based exchanges over coin-only platforms.
Who is affected
The 26 registered South Korean virtual asset service providers, including 17 exchanges and nine custody and wallet providers.
What's next
No next step announced.
Primary source
fsc.go.kr: Press Releases - Financial Services Commission

Key points

  • Domestic exchange operating profits dropped 78% and sales fell 41% in H1 2026, according to KoFIU and FSS survey data.
  • Exchange market capitalization fell by KRW28.3 trillion (33%), while daily trading volume fell by KRW2.3 trillion (44%).
  • Custody and wallet providers saw managed assets decrease by KRW76.7 billion (25%), posting an operating profit drop of KRW9.4 billion.

Operating profits across South Korea's registered virtual asset exchanges dropped 78% in the first half of 2026, according to a survey released by the Financial Services Commission (FSC) 1. The joint assessment by the Korea Financial Intelligence Unit (KoFIU) and the Financial Supervisory Service (FSS) reviewed 26 registered virtual asset service providers (VASPs), including 17 exchanges and nine custody and wallet operators, covering activity from Jan. 1 to June 30, 2026 1.

During the six-month period, domestic exchange service providers experienced broad contraction across operational metrics 1. Aggregate crypto market capitalization fell by KRW28.3 trillion (down 33%), while average daily trading volume declined by KRW2.3 trillion (down 44%) 1. Total deposits denominated in South Korean won dropped by KRW2.9 trillion (down 35%) 1. As a result, exchange sales decreased 41% and operating profits tumbled 78%, even as the number of eligible trading accounts edged up 0.4% 1. Total staff employed by exchange providers declined by 10 individuals to 2,021, though dedicated anti-money laundering (AML) professionals rose by one to 213 1.

Market Concentration and Custody Contraction

The survey highlighted persistent concentration in fiat-paired trading, following previous evaluations of the regional ecosystem such as South Korea Leads East Asia With $449 Billion Crypto Economy Powered by AI Tokens 1. Won-based exchanges accounted for 99.4% of total market capitalization, leaving coin-only platforms with just 0.6% 1. Daily volume on coin-only exchanges dropped by KRW450 million (down 55%), with monthly turnover ratios between 2% and 9%, compared to 100% to 201% on won-based exchanges 1.

Regulators also monitored token diversity and custody providers 1. Active standalone tokens fell 5% to 673 assets, down from 712 at the end of 2025 1. Among 234 exclusively listed assets representing KRW0.6 trillion in value, 93 tokens carried individual market capitalizations of KRW100 million or less, prompting regulatory warnings over potential illiquidity 1. External transfers of virtual assets dropped 41% overall, with whitelisted entities and personal wallets capturing 83% and travel rule transfers representing 15% 1. Meanwhile, custody and wallet providers saw total virtual assets under management decrease by KRW76.7 billion (down 25%), contributing to a KRW9.4 billion operating loss (down 101%) 1.

Questions this story raises

Which entities were surveyed by South Korean authorities?
The KoFIU and FSS surveyed 26 registered virtual asset service providers, consisting of 17 exchange service providers and nine custody and wallet operators.
How did Korean won deposits change in H1 2026?
Total deposits denominated in Korean won fell by KRW2.9 trillion, representing a 35% decrease compared to the prior period.

Sources

  1. [1] Press Releases - Financial Services Commission — fsc.go.kr, October 8, 2026

Written by Basis Desk's newsroom system from the primary sources above and machine-verified against them before publication. Market figures marked "at the time of writing" come from live exchange data. Report an error: corrections@basisdesk.news · corrections policy.

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