The South Korean Won has overtaken the US Dollar to become the most traded fiat currency against digital assets, marking a shift in global cryptocurrency markets. According to a recent study by Kaiko, the Won achieved over $456 billion in trading volume on centralized exchanges in the first quarter of 2024, narrowly surpassing the $455 billion recorded for the US Dollar.
Intense Competition Fuels Trading Surge
This surge in trading volume can be attributed to the intense competition among South Korean crypto exchanges, which have been engaged in a “fee war.” In an effort to attract traders, major platforms like Upbit and Bithumb have slashed trading fees, with Bithumb even adopting a zero-fee policy in late 2023.Â
Although this strategy boosted volume, it impacted Bithumb’s revenue, leading to a 60% decline in annual earnings.
The market landscape has been further energized by macroeconomic improvements and the bullish momentum observed across the crypto sector. Upbit continues to dominate the South Korean market, commanding an 82% share. Meanwhile, Bithumb has seen its market share triple, despite the financial setbacks caused by its pricing strategy.
As the competitive landscape evolves, the Korean Won’s prominence in crypto trading highlights its growing role in the global financial ecosystem. The trend is set to continue, with potential impacts from new regulations and the introduction of cryptocurrency ETFs in neighboring markets like Hong Kong.
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