South Koreans’ Crypto Holdings Halve in a Year as Stablecoin Holdings Double

South Korean investors’ crypto holdings and trading volume have dropped by more than 60 trillion won over about a year, while stablecoin holdings moved in the opposite direction, more than doubling. The shift is widely attributed to money moving into a strong stock market and to a preference for dollar-linked assets amid a weak won.

Data the Bank of Korea submitted on Monday to Rep. Cha Gyu-geun of the Rebuilding Korea Party, a member of the National Assembly’s Planning and Finance Committee, showed domestic crypto holdings totaled 60.6 trillion won as of the end of February. The figure sums investors’ assets at month-end market prices across the country’s five major crypto exchanges: Upbit, Bithumb, Korbit, Coinone and Gopax.

Holdings surged from 50.6 trillion won in August 2024 to a peak of 121.8 trillion won in January last year, when U.S. President Donald Trump took office. They have since fallen to less than half that level in 1 year and 1 month.

Average daily trading value also declined. It rose from 2.7 trillion won in August 2024 to 17.1 trillion won at the end of December that year, but stood at about 4.5 trillion won in February. Won-denominated deposits on exchanges, often seen as funds waiting to be invested, fell to 7.8 trillion won in February from 10.7 trillion won at the end of December 2024.

The decline was attributed to a combination of a buoyant domestic stock market drawing investment funds and falling crypto prices.

Stablecoin holdings, however, increased. They rose from 88.5 billion won at the end of July 2024 to a peak of 872.3 billion won at the end of December last year. The total eased to 607.1 billion won in February, but was still about 2.2 times the level in January last year (278.2 billion won).

Industry officials pointed to stronger demand for dollar-based assets amid a high exchange rate. Kim Min-seung, head of Korbit’s research center, said fluctuations in the won-dollar exchange rate appeared to have influenced demand for stablecoin investments. He added that with most coins weakening on overseas exchanges, funds that had moved abroad may also have returned to the domestic market.