South Korea crypto accounts top 11.1 million as growth slows to 3%

South Korea’s KYC-verified crypto exchange accounts climbed to 11.13 million by the end of last year, nearly doubling from 5.58 million at end-2021, but the pace of new user growth has collapsed as crypto underperformed equities and commodities and drained retail inflows.

The figures, drawn from a Financial Services Commission survey of virtual asset service providers and reported by the Digital Times on May 10, show the tradable user growth rate fell to 3 per cent in the second half of last year, down from 25 per cent in the second half of 2024 and 21 per cent in the first half of that year. The net inflow of first-time depositors has all but stopped.

The headline 11.13 million figure, equivalent to roughly one in five South Koreans holding a verified exchange account, masks a market that has cooled sharply after the pandemic-era retail frenzy that turned the country into one of the world’s most active crypto trading hubs. Industry officials told the Digital Times that the crypto market’s “relatively weak performance compared with domestic and overseas stock markets and commodities” had reduced the inflow of new investors.

The slowdown is structural as much as cyclical. South Korean exchanges remain centred on spot trading (futures and derivatives are tightly restricted under the Capital Markets Act) and officials cited the spot-only structure as “a constraint on further growth.” Without the leverage products that drive volume on offshore venues such as Binance and Bybit, domestic platforms have struggled to sustain engagement as price action flattened through the second half of last year.

Exchange headcount reflects the earlier boom

The employment figures tell the same story with a lag. Combined headcount at the country’s two dominant exchanges, Upbit and Bithumb, reached 1,334 by the end of last year, up from 682 at the end of 2021, according to Financial Supervisory Service electronic disclosure filings. Upbit added 326 staff over the period to reach 696 employees, while Bithumb grew from 312 to 638.

The hiring predates the slowdown. Exchanges staffed up to handle the surge in customer onboarding and compliance overhead during the 2021-2024 expansion, but the 3 per cent user growth in the most recent half suggests that capacity now outstrips demand. South Korean exchanges, unlike their global peers, cannot offset thinning spot volumes with derivatives fees, structured products, or lending desks. Each of those requires separate regulatory approval that has not been forthcoming from the FSC.

What changed

South Korean retail crypto participation peaked in 2021 and 2022, driven by low equity market returns, a weakening won, and the social-trading dynamics unique to the market. Altcoin narratives spread through KakaoTalk groups and Naver cafes with a speed that outpaced regulatory response. The Kospi’s recovery through 2024 and 2025, coupled with a global equity rally, pulled marginal capital back into stocks. Commodities, particularly gold’s push toward $4,800 per ounce, offered a competing speculative outlet that crypto, trading sideways for much of last year, could not match.

The FSC data also captures a market where new projects have largely bypassed Korean exchanges. While global volumes migrated toward Solana-based memecoin trading and DeFi protocols through 2024 and 2025, South Korean platforms stayed limited to a narrower set of listed tokens, with new listings subject to a review process that can take months. The result is a product gap: the assets generating the most trading activity globally are not available to Korean retail on regulated venues.

The 11.13 million account figure, while large, overstates the active user base. Multiple accounts per user, dormant wallets, and accounts opened solely for airdrop farming during the 2023-2024 cycle inflate the headline number. The FSC survey does not break out active versus inactive users, but the 3 per cent growth rate in tradable users (the subset capable of depositing and trading) suggests the net inflow of genuine new participants has stalled.

The regulatory backdrop

The data lands as South Korea’s crypto framework continues to take shape under the Virtual Asset User Protection Act, which came into force in July 2024. The law imposes custody, disclosure, and reserve requirements on exchanges, raising the compliance cost of onboarding each new user. Every new account now requires enhanced KYC verification, source-of-funds checks, and ongoing transaction monitoring, a compliance burden that tilts the economics toward serving existing accounts rather than chasing growth.

A second legislative phase, covering token issuance and disclosure rules, remains under discussion in the National Assembly. Until those rules are settled, exchanges cannot list new tokens at the pace of global venues and cannot offer the derivative products that might re-engage a retail base now allocating elsewhere.

For the country’s exchanges, the path forward comes down to two things: regulatory liberalisation that permits broader product offerings, or a crypto market recovery strong enough to pull retail capital back from equities and commodities. The FSC data suggests neither has arrived yet.