Under Strict Regulations in Korea, Over $110 Billion in Crypto Assets Flows Out Overseas as Local Exchanges Struggle

By: theblockbeats.news|2026/01/02 15:46:02
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BlockBeats News, January 2nd, according to a report jointly released on Friday by Coingecko and Tiger Research, due to local regulatory restrictions in South Korea, the scale of funds transferred by the country's investors from domestic cryptocurrency exchanges to overseas platforms exceeded 160 trillion Korean won (approximately $110 billion) last year. South Korea, as one of the most active digital asset markets in Asia, has a relatively lagging regulatory framework.

Last December, the much-anticipated "Digital Assets Basic Law" (DABA) was postponed due to regulatory agency disagreements on stablecoin issuance issues. This foundational law aimed at comprehensively regulating cryptocurrency trading and issuance has not yet been enacted. The "Virtual Asset User Protection Law," set to take effect in 2024, does not address market structural issues such as leverage trading or derivatives trading.

Regulatory gaps have raised concerns among market participants, who worry that South Korea's centralized cryptocurrency exchanges are increasingly struggling to compete with overseas platforms offering more sophisticated trading products. South Korean news agency Aju Press noted in a report in November: "The number of South Korean investors holding large accounts on overseas cryptocurrency exchanges has more than doubled in a year, reflecting both the global market's recovery and highlighting investors' growing dissatisfaction with South Korea's restrictive trading environment."

The research found that cryptocurrency has become a major investment asset in South Korea, with the number of investors reaching 10 million, and the revenue of exchanges such as Upbit and Bithumb reaching tens of trillions of Korean won. However, the report shows that despite South Korean investors actively trading cryptocurrency and increasingly turning to overseas platforms like Binance and Bybit, the growth of domestic exchanges has stagnated.

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