$110 billion in crypto left South Korea in 2025 owing to strict trading rules
Analysis
Price Impact
MedSouth korea, a major crypto market, saw $110 billion in crypto assets move from domestic to foreign exchanges in 2025 due to restrictive local trading rules. while this represents a significant capital outflow from the local market, the funds are primarily relocating within the broader crypto ecosystem to platforms offering more diverse products like derivatives, rather than exiting crypto entirely. this might reduce local liquidity and market depth in south korea, but the global impact is moderated by the fact that capital remains within crypto.
Trustworthiness
HighThe information is based on a joint coingecko and tiger research report, cited and reported by coindesk, both reputable sources in the crypto industry.
Price Direction
NeutralThe movement of $110 billion from south korean domestic exchanges to foreign platforms is driven by investors seeking access to a wider range of trading products (e.g., derivatives) unavailable locally. this indicates continued strong demand for crypto and advanced trading strategies among south korean investors. while local exchanges suffer, the capital is not leaving the crypto market, merely shifting venues. this suggests a reallocation rather than a net negative, leading to a neutral broader price direction, though it highlights regulatory challenges in a key market.
Time Effect
LongThe capital outflow in 2025 is a result of ongoing regulatory delays (e.g., the digital asset basic act) and existing restrictive policies in south korea that limit domestic exchanges to spot trading. this is a structural issue that has developed over time and will likely continue to influence investor behavior until significant regulatory reforms are enacted.
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Finance Share Share this article Copy link X icon X (Twitter) LinkedIn Facebook Email $110 billion in crypto left South Korea in 2025 owing to strict trading rules While South Korean financial officials acknowledged the need for new rules, disagreements over stablecoins delayed a broader crypto framework. By Olivier Acuna | Edited by Sheldon Reback Jan 2, 2026, 2:25 p.m. South Korea saw crypto outflows from domestic CEXs to foreign platforms in 2025. (Yu Kato/Unsplash modified by CoinDesk) What to know : South Koreans transferred over 160 trillion won to foreign crypto exchanges last year due to domestic regulatory restrictions. The delay in implementing the Digital Asset Basic Act has left a regulatory gap, pushing investors to offshore platforms. Domestic exchanges face strict regulations, limiting them to spot trading, while foreign platforms offer more complex products. South Koreans moved more than 160 trillion won ($110 billion) from local crypto exchanges to foreign platforms last year due regulatory restrictions in the country, one of Asia’s most active digital asset markets, a joint Coingecko and Tiger Research report revealed Friday . The regulatory framework has been slow to evolve. In December, the long-awaited Digital Asset Basic Act (DABA), a sweeping framework meant to govern crypto trading and issuance, was delayed because of disagreements among regulators over stablecoin issuance. The Virtual Asset User Protection Act, which came into force in 2024, does not address market structure issues such as leverage or derivatives trading. STORY CONTINUES BELOW Don't miss another story. Subscribe to the Crypto Daybook Americas Newsletter today . See all newsletters Sign me up By signing up, you will receive emails about CoinDesk products and you agree to our terms of use and privacy policy . The regulatory gap raised concerns among market participants that Korea’s centralized crypto exchanges (CEXs) are increasingly unable to compete with offshore platforms offering more complex trading products. “The number of South Korean investors holding large sums in overseas cryptocurrency exchange accounts has more than doubled in a year, reflecting both the global market’s resurgence and growing frustration with South Korea’s restrictive trading environment,” Korean news agency Aju Press reported in November. The research found that cryptocurrency has become a primary investment asset in South Korea, with investor numbers rising to 10 million and exchanges such as Upbit and Bithumb generating revenues in the trillions of won. Growth, however, is stagnating, even as Korean investors continue to trade crypto actively and increasingly turn to foreign-based platforms such as Binance and Bybit, according to the report. The report said the main reason Korean investors are moving funds offshore is the gap in investment opportunities, as South Korea prohibits domestic exchanges from offering crypto derivatives to retail traders. “Domestic CEXs face strict regulations that limit them to spot trading, while foreign CEXs fill this gap with more complex products, including leveraged derivatives,” it said. South Korea Regulations Crypto Exchange More For You KuCoin Hits Record Market Share as 2025 Volumes Outpace Crypto Market By CoinDesk Research Dec 22, 2025 Commissioned by KuCoin KuCoin captured a record share of centralised exchange volume in 2025, with more than $1.25tn traded as its volumes grew faster than the wider crypto market. What to know : KuCoin recorded over $1.25 trillion in total trading volume in 2025 , equivalent to an average of roughly $114 billion per month , marking its strongest year on record. This performance translated into an all-time high share of centralised exchange volume , as KuCoin’s activity expanded faster than aggregate CEX volumes , which slowed during periods of lower market volatility. Spot and derivatives volumes were evenly split , each exceeding $500 billion for the year, signalling broad-based usage rather than reliance on a single product line. Altcoins accounted for the majority of trading activity , reinforcing KuCoin’s role as a primary liquidity venue beyond BTC and ETH at a time when majors saw more muted turnover. Even as overall crypto volumes softened mid-year, KuCoin maintained elevated baseline activity , indicating structurally higher user engagement rather than short-lived volume spikes. 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