Decoding the Korean cryptocurrency market: Why are Upbit and Bithumb so powerful?
What is the ultimate goal of the project parties, and how can they capture the favor of the "oppa" by appealing to the craziest retail investors globally?This article is created by GIG DAO's exclusive partner in Korea, Notch Ventures, analyzing the structural advantages and regulatory challenges of listing on the two major exchanges in Korea, and focusing on potential market trends through recent successful listing cases.
What comes to mind when you think of the Korean crypto market? Is it the $LUNA crash in 2022, or the huge arbitrage opportunities brought by the "kimchi premium"? I believe that for industry practitioners, the most anticipated hope is that their projects can one day be listed on Korean exchanges, causing the coin price to soar directly 🚀
1. Overview of the Korean Cryptocurrency Market: A Duopoly with 98% Market Share
1.1 Why is the Korean market so attractive?
Due to President Yoon Suk-yeol's emergency martial law announcement on December 3, 2024, which led to heightened tension in the financial markets, the trading volume in the Korean cryptocurrency market reached an all-time high the following day, with Upbit's KRW trading volume hitting ₩51.2 trillion (approximately $38.7 billion), far exceeding its usual ₩10 trillion benchmark, accounting for 80.5% of Korea's cryptocurrency trading volume. This made Upbit rank second globally in daily retail trading intensity, only behind Binance, despite its relatively small global influence.
As of February 2025, Upbit's market share in Korea stabilized at 59%, continuing to rank among the top 10 exchanges globally in terms of altcoin trading liquidity. Notably, unlike other global centralized exchanges (CEX) that primarily trade BTC, the trading volume in the Korean crypto market is mainly concentrated on altcoins (such as XRP). This is highly attractive to project founders, so once a project announces its listing on a Korean exchange, the coin price can experience astonishing increases in a short time.
1.2 Competition between Upbit and Bithumb
The Korean market presents a duopoly, with Upbit and Bithumb monopolizing 98% of the trading volume.
- Upbit is more popular, especially during bull markets
Upbit was established in 2017 and incubated by the Korean fintech company Dunamu, which has close ties with "Korean WeChat" Kakao, which owns over 20% of Upbit. During market upswings, Korean retail investors prefer to use Upbit due to its stronger liquidity and higher security. In December 2024, as BTC approached its historical high, Upbit's market share soared from 56.5% to 78.2%, while Bithumb's market share fell from 41.2% to 19.3%.
- Bithumb adopts a more aggressive competitive strategy
Bithumb was established a few years earlier than Upbit and was once the largest exchange in Korea. However, after experiencing several hacking incidents worth millions of dollars in 2018-2019, it lost users and was overtaken by Upbit. To capture users, Bithumb has been more aggressive in listing and funding rates compared to Upbit:
1.
- Zero trading fees: Bithumb eliminated trading fees in October 2024, resulting in a 32% increase in daily active users in the short term, but this strategy is unsustainable, as users returned to Upbit after the promotion ended.
- Listing of altcoins and meme tokens: Bithumb listed 7 meme coins (such as $PONKE, $SUNDOG) in 2024, attracting young traders seeking high-risk, high-reward opportunities. For example, after the listing of the $TRUMP token, Bithumb accounted for 41% of the trading volume.
Although Upbit is known for its conservatism, it also had to join the meme coin craze. Between August 2024 and February 2025, Upbit listed 5 meme tokens ($PEPE, $BRETT, $BONK, $MEW, $TRUMP) to counter Bithumb's market share erosion.
2. Why do project teams want to list on Upbit?
"석우빔" (Seokwoo Beam) is a term created by Korean traders, referring to the sudden price surge of certain tokens when listed on Upbit. However, historical data shows:
- Most tokens show either a brief rise followed by a drop or an immediate drop in the 5-minute K-line chart after listing on Upbit.
- Taking $TRUMP as an example, after Upbit announced its listing:
- Price increased by 10%, trading volume increased by 50%.
- Within 24 hours of listing, trading volume surged from $1 billion to $6 billion.
Although not all tokens experience the "석우빔" effect, listing on Upbit remains the most ideal liquidity outlet, so project teams are still eager to secure listing opportunities on this exchange.
3. Recent Analysis of Upbit Listings
We compiled the performance of tokens listed on Upbit at the beginning of 2025:
| Token | Listing Announcement Time | Listing Time | Price Increase Within 1 Hour | Trading Volume Growth After Listing | |----------|----------------------|----------------------|------------|----------| | $TRUMP | 2025.02.13 15:24 KST | 2025.02.13 18:00 KST | +11% | +100% | | $LAYER | 2025.02.12 08:30 KST | 2025.02.12 09:00 KST | +40% | +101% | | $BERA | 2025.02.06 13:56 KST | 2025.02.06 23:50 KST | -7% | +70% | | $VIRTUAL | 2025.01.31 17:17 KST | 2025.01.31 20:00 KST | +14% | +117% | | $ANIME | 2025.01.23 18:36 KST | 2025.01.24 10:00 KST | +4% | +58% | | $SONIC | 2025.01.07 16:31 KST | 2025.01.08 14:00 KST | -8% | +24% |
Although there is no public data, it is rumored that after a token is listed on Upbit, project teams can conservatively estimate that they can sell at least several million dollars through market makers without affecting the coin price, fully covering their listing fees.
4. Increasingly Strict Regulatory Policies
Despite the liquidity advantages enjoyed by the two major exchanges, their listing processes still face strict government regulation. Many intermediaries or project teams attempt to secure listing slots by leveraging internal key personnel, often through bribes. Although this phenomenon does exist, both Upbit and Bithumb are licensed onshore exchanges, and their regulatory scrutiny is much higher than that of offshore exchanges like Binance and Bybit, with past incidents of exchange staff being imprisoned for accepting bribes.
4.1 Anti-Money Laundering (AML) and KYC Regulations
- The Korean Financial Intelligence Unit (FIU) is investigating whether Upbit is trading with unregistered exchanges, focusing on risks related to money laundering and terrorist financing.
- The Korean government believes that certain offshore exchanges providing Korean language services but not registered may pose money laundering risks, as these exchanges can conduct cryptocurrency transfers with onshore exchanges through the "travel rule."
4.2 Market Monopoly Issues
The duopoly of Upbit (78.2% market share) and Bithumb (19.3% market share) has raised concerns among Korean lawmakers, and the government plans to promote relevant policies to enhance market competition.
Coinone and Korbit are two other exchanges in Korea, but their market shares have been squeezed to single digits, so there are not many project teams willing to list on these two exchanges.
5. How to List on Upbit or Bithumb?
As Korean regulations become increasingly strict, the method of obtaining exchange listings through intermediaries has become extremely high-risk, and many so-called "listing brokers" are actually scammers.
The correct listing strategy should include:
Building brand awareness in the Korean market:
- Develop local communities in Korea, enhance visibility through KOL marketing and offline events.
- Publish articles in authoritative Korean crypto media to increase exposure and credibility.
Enhancing project compliance:
- Have been listed on at least one or more top global exchanges (Binance, Coinbase, OKX, Bybit) with high trading volumes.
- Operate transparently, comply with KYC and AML regulatory requirements; anonymous projects find it difficult to qualify for listings (except for meme coins).
Conclusion
The Korean market offers high liquidity and strong retail capital for global crypto projects, but the listing process is fraught with challenges due to strict regulations. For project teams looking to enter the Korean market, having tokens listed on top exchanges and building local communities are key to success. Projects interested in expanding into the Korean market are welcome to contact Notch Ventures for answers to listing strategy-related questions.
