South Korean investors have shown a clear preference for altcoins and local tokens in the cryptocurrency market, diverging from global trends. A recent report by DeSpread Research highlights the unique landscape of South Korean crypto trading. Approximately 10% of the nation's population, or about 6 million individuals, are actively involved in crypto investments. Centralized exchanges play a significant role in South Korea's crypto market.
Despite a global decline in trading volumes across centralized exchanges, South Korea's local exchanges have experienced a surge in activity. Upbit, the leading exchange in the country, outperformed global giant Binance in July. This upturn was partially driven by the positive outcome of Ripple's legal battle with the SEC, leading to a significant increase in XRP's price and trading volumes.
South Korean traders are particularly attracted to altcoins due to their high-profit potential, even in the face of elevated risks. Upbit, in particular, reflects this trend, with a strong preference for altcoins among individual investors. Surprisingly, major global cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and Polygon (MATIC) have a limited presence on Upbit, showcasing regional disparities in trading preferences.
South Korean traders also favor different transaction networks, with Tron's network gaining prominence due to its lower transaction fees. Despite the surge in local exchange volumes, South Koreans still store a significant portion of their digital assets on overseas platforms, amounting to $99 billion, as reported by the country's national tax service in September. This unique characteristic of the South Korean market has tax implications for crypto traders.
The South Korean crypto market paints a nuanced portrait marked by a strong affinity for altcoins, local tokens, and unique transaction networks, setting it apart from global trading patterns. This unique landscape may impact the Forex market, where traders must consider these distinctive preferences and investment strategies. Forex traders interested in cryptocurrency markets should be aware of South Korea's influence on altcoin trading trends and the potential implications for currency exchange rates.