$110 Billion in Crypto Vanishes from South Korea: The Great Digital Escape! 💸

by

Finance

What to know:

  • In a plot twist that even the best soap opera writers would envy, South Koreans transferred over 160 trillion won to foreign crypto exchanges last year, all thanks to some rather draconian domestic trading regulations. Who knew finance could be so dramatic?
  • The ever-so-handy Digital Asset Basic Act (DABA) has been delayed longer than a train in the English countryside, leaving investors with no choice but to escape to offshore platforms like kids sneaking out for an adventure.
  • While domestic exchanges are shackled by strict rules-limited to the equivalent of a game of tic-tac-toe-foreign platforms are rolling out the red carpet with exciting options like leveraged trading and derivatives. Talk about a party crasher!

In a jaw-dropping revelation from a joint report by Coingecko and Tiger Research, it appears South Koreans have whisked away more than 160 trillion won (a whopping $110 billion) from local crypto exchanges to their foreign counterparts. It’s as if they’ve decided to take their toys and play elsewhere because the rules were simply too boring.

Now, let’s talk about the regulatory framework, or lack thereof, shall we? The much-anticipated DABA-which has been delayed more times than my uncle’s holiday visits-was put on ice in December due to a disagreement over stablecoin issuance. Apparently, regulators can’t agree on how to govern digital assets, which is about as surprising as finding out cats don’t like water.

With this gaping regulatory hole, market participants are wringing their hands, concerned that Korea’s centralized crypto exchanges (CEXs) are becoming as competitive as a three-legged dog in a race against greyhounds. The offshore platforms are practically throwing down the gauntlet with their extravagant offerings.

As reported by the Korean news agency Aju Press in November, the number of savvy South Korean investors holding hefty sums in overseas cryptocurrency exchange accounts has more than doubled in just a year. Clearly, frustration with the local trading scene is reaching new heights, akin to a soufflé that’s about to collapse.

Indeed, cryptocurrency has become the darling of investment assets in South Korea, with the number of investors skyrocketing to 10 million and exchanges like Upbit and Bithumb raking in revenues in the trillions of won. Who knew digital coins could be so alluring?

However, growth resembles a snail on a leisurely stroll, even as Korean investors eagerly dabble in crypto while casting longing glances at foreign platforms such as Binance and Bybit. One must wonder if they’re stuck in a regulatory time warp.

The report unceremoniously points out that the primary reason Korean investors are shifting their hard-earned funds offshore is the glaring gap in investment opportunities. With domestic exchanges being scolded to stick to spot trading, it’s no surprise that they’re missing out on the fun that foreign exchanges are having with derivatives.

So there you have it, dear reader! As South Koreans dash off to distant shores in search of crypto riches, the local exchanges are left twiddling their thumbs, wondering where it all went wrong. As the saying goes, “When the cat’s away, the mice will play!” 🐭💰

Read More

2026-01-02 18:11