Author: Liam, Deep Tide TechFlow

If there were a poll to choose the world's most avid cryptocurrency traders, South Koreans would definitely be on the list.

South Korea has long been one of the world's most enthusiastic countries about cryptocurrencies, with the market even coining the term "Kimchi Premium," referring to the fact that South Korean traders once paid 10% more for Bitcoin than the global average.

But by 2025, the tide had turned.

Trading volume on Upbit, South Korea’s largest cryptocurrency exchange, has fallen by 80% compared to the same period last year, and the activity of the Bitcoin-Korean Won trading pair is far less than in previous years; on the contrary, the South Korean stock market is booming, with the KOSPI index surging by more than 70% this year and continuing to set new historical highs.

On Kakao Talk and Naver forums, retail investors who used to discuss altcoins every day are now talking about "AI semiconductor concept stocks".

The ghost stories of the cryptocurrency world are coming; even South Koreans are no longer trading cryptocurrencies much.

Trading volume halved, South Koreans stopped trading cryptocurrencies.

Over the past few years, South Korea has been a battleground for the global crypto market.

For exchanges and project teams, this is a place with high-net-worth, high-quality clients. To put it more simply, South Koreans are often the main buyers of altcoins.

Media and film and television works are full of stories about South Koreans who speculate on cryptocurrencies all night, get rich quickly, and then lose everything.

So when someone tells you that retail investors in this "cryptocurrency trading nation" don't trade cryptocurrencies much anymore, you might find it absurd.

But the data doesn't lie.

Trading volume on Upbit, South Korea's largest exchange, has plummeted.

In November 2025, Upbit's average daily transaction volume was only $1.78 billion, a sharp drop of 80% compared to $9 billion in December 2024, and has been declining for four consecutive months.

Upbit's historical peak occurred on December 3, 2024, the night South Korea declared martial law, with a trading volume of $27.45 billion, ten times its usual volume.

But that night's frenzy marked the peak, after which the market quickly cooled down, and trading volume plummeted.

More notably, the volatility of trading volume has also decreased significantly.

During the frenzy at the end of 2024, daily trading volume often fluctuated wildly between $5 billion and $27 billion; however, after entering 2025, trading volume stabilized for most of the time within the range of $2 billion to $4 billion, with the fluctuation range narrowing significantly.

Bithumb, South Korea's second-largest stock exchange, suffered a similar fate.

At the end of 2024 (December), Bithumb's average daily trading volume was approximately $2.45 billion. By November 2025, it had dropped to only about $890 million, a decrease of about 69% overall, with a liquidity loss of nearly two-thirds.

The two largest domestic exchanges in South Korea (Upbit and Bithumb) both experienced a "decline in trading volume" in the same period, which not only signifies a cooling of trading but also a general retreat in the sentiment of South Korean retail investors.

Search data confirms this: in Google search trends in South Korea, the latest search index for Bitcoin is 44, a 66% drop from its peak of 100 at the end of 2024.

South Korean stock market frenzy

So, where does all the money of South Koreans go? The answer is: the stock market.

This year's South Korean stock market can be described as a reincarnation of the 2017 Bitcoin bull market, an epic bull run.

South Korea's benchmark KOSPI index hit 17 intraday record highs in October, breaking through the 4,200-point mark. In October alone, it rose by nearly 21%, marking its best single month since 2001.

Since the beginning of the year, the KOSPI index has surged by more than 72%, leading all asset classes.

KOSPI's average daily turnover in October reached 16.6 trillion won (approximately US$11.5 billion), with a single-day peak of 18.9 trillion won, a 44% increase compared to September. Brokerage apps experienced temporary lag.

This is just the index; individual stocks are even more frenzied.

Samsung Electronics' stock price has risen 100% year-to-date; SK Hynix, the memory chip leader, has seen its stock price rise 70% this quarter and surge 240% year-to-date. The two companies together have an average daily trading volume of 4.59 trillion won, accounting for 28% of the entire market.

The market frenzy was so high that even the stock exchange couldn't stand it anymore. The Korea Exchange announced on Monday evening that it had issued an "investment warning" notice for SK Hynix stock due to its rapid rise, which caused SK Hynix's stock price to plummet on Tuesday.

AI has become a "national belief".

The South Korean stock market was once stagnant, with little growth for over a decade. Local media frequently predicted its decline, claiming that "the South Korean stock market has no future." This led many South Korean investors to speculate in cryptocurrencies or invest in US stocks. Why did the South Korean stock market turn around in 2025?

The recent surge in the South Korean stock market may seem like a case of "retail investors going crazy," but the underlying logic is remarkably clear:

The global AI wave, policy support, and the return of domestic capital are all contributing factors.

Everyone knows that the spark that ignited this round of market activity came from AI.

ChatGPT ignited the second phase of the global tech bubble, and South Korea happened to be sitting in the "ammunition depot" of the supply chain.

South Korea is the world's leading country in memory chips. SK Hynix and Samsung Electronics have almost monopolized the high-bandwidth memory (HBM) market, and HBM is the most critical raw material for training large AI models.

This means that whenever Nvidia and AMD's GPU shipments increase, the profit curves of South Korean companies rise in tandem.

At the end of October, SK Hynix released its financial report, showing that its revenue in the third quarter was US$17.1 billion and its operating profit was US$8 billion, a year-on-year increase of 62%, both of which were record highs.

More importantly, SK Hynix has secured customer demand for all of its DRAM and NAND production capacity for 2026, resulting in a supply shortage.

So the Koreans discovered:

AI is America's narrative, but South Korea is making the money.

If Nvidia is the soul of the US stock market, then South Korean retail investors have found their faith in SK Hynix.

From cryptocurrency to the stock market, they are still chasing the "dream of tenfold returns," but buying Samsung or SK can also crown them with the laurel of "patriotism."

In addition, don't overlook a crucial background: the South Korean government is making every effort to rescue the stock market.

For a long time, South Korean stocks have been subject to what is known as the "Korea Discount".

Family-owned conglomerates monopolize the market, corporate governance is chaotic, and shareholder returns are low, leading to the general undervaluation of South Korean companies. Even Samsung Electronics has long been undervalued compared to its global counterparts, and SK Hynix's PE ratio is still only 14 after a 240% increase.

After Yoon Seok-youl's administration came to power, it launched a reform plan known as the "Korean version of the shareholder value revolution":

Encourage companies to increase dividends and repurchase shares;

Crack down on cross-shareholding by conglomerates;

Lower capital gains tax and encourage pension funds and retail investors to increase their domestic allocations.

This reform has been described by the media as a "national action to free South Korea from the burden of discounts."

As a result, overseas funds began to flow back, and local institutions and individual investors also "went home to buy stocks".

Of course, another reality is that there's nowhere for the money to go.

The South Korean housing market is cooling down during a high-interest-rate cycle, US stock valuations are high, and the cryptocurrency market can only passively take over.

Investors need a new gambling table, and the stock market just happens to provide a legitimate gambling venue.

According to data from the Bank of Korea, more than 5 million new securities accounts were opened by domestic retail investors in the first half of this year, and the number of downloads of brokerage apps has surged.

The speed at which funds are flowing into KOSPI is even faster than when retail investors rushed into the cryptocurrency market in 2021.

Meanwhile, South Korean pension funds and insurance funds are also increasing their holdings in domestic technology stocks.

From the government to institutions to individual investors, everyone is rushing into the stock market. You could even call it a "national-level bull market."

Speculation Never Sleeps

Unlike the cryptocurrency market, which relies on "emotion" to drive prices up, the South Korean stock market's current "bull run" is at least supported by some performance data.

Finally, one point must be acknowledged:

This stock market bull market is essentially a nationwide "emotional resonance".

South Koreans haven't changed; they've just changed their gambling table. They not only know how to gamble, but they also know how to leverage.

According to Bloomberg, South Korean retail investors are significantly increasing their leverage, causing margin loan balances to double in five years, as they flock to highly leveraged and inverse ETFs.

According to data from Gelonghui, in 2025, leveraged funds held by South Korean retail investors accounted for 28.7% of total holdings, 9% more than the previous year; holdings of 3x leveraged products rose from 5.1% to 12.8%, and leverage usage among young people aged 25-35 was 41.2%.

This generation of retail investors comes with an "all-in gene".

However, when South Korean retail investors flocked to the stock market, a question arose:

"Koreans aren't trading cryptocurrencies anymore, so who's going to buy up all the altcoins?"

In the past few years, the South Korean market has often been the last to buy altcoins.

From Dogecoin to PEPE, from LUNA to XRP, South Korean retail investors have been a constant presence in almost every bull market.

They represent the "ultimate sentiment indicator" of the global crypto market; as long as South Korea continues to buy, the bubble hasn't peaked.

But now, the trading volumes of Upbit and Bithumb have both plummeted, and the cryptocurrency world has lost its last believer, thus losing its biggest source of fuel.

Altcoins have no buyers.

Perhaps, we'll have to wait until the current global AI stock market frenzy subsides, or until the cryptocurrency world can tell a compelling story again.

At that time, the sleeping gamblers will be awakened and return to the chain to continue betting.

After all, the gambler is still there, just in a different casino.

Upbit adds USDT trading pairs for 12 tokens including AGLD, FIL, ARPA

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