Bithumb's market share has dropped to 24.8%, and the gap with Upbit has widened after the end of the zero-fee promotion
The South Korean cryptocurrency exchange Bithumb has continued to face pressure on its market share following the "Bitcoin Misallocation Incident." Data shows that as of last Friday, Bithumb's trading share among the five Korean won-denominated exchanges in South Korea dropped to 24.8%, significantly down from about 30% at the beginning of the year. Industry data indicates that Upbit remains in the lead with a 58.4% share, Coinone accounts for 13%, Korbit for 3.5%, and Gopax for 0.3%.On February 6, Bithumb mistakenly distributed 2,000 bitcoins worth 2,000 won (approximately $1.38) to some users during a promotional event, totaling an erroneous distribution of about 620,000 BTC, far exceeding its previously disclosed holding of 42,800 coins, raising doubts about its internal controls and financial management capabilities. The day after the incident, its market share fell from 31.5% on January 5 to just over 20%. To stabilize the situation, Bithumb implemented a one-week zero-fee promotion for all cryptocurrencies starting February 9, which temporarily boosted trading, and on February 10, its market share briefly rebounded to 31.5%. However, following the end of the promotion on February 16, the share quickly declined. Meanwhile, competitors have clearly benefited. Coinone's share has doubled compared to a month ago, and Korbit's trading volume has increased by about 12.5 times, driven by expectations surrounding Mirae Asset Financial Group's acquisition of a 92% stake. Upbit is advancing a comprehensive share swap plan with Naver Financial, while Gopax has been acquired by Binance, potentially reshaping the landscape of Korean exchanges.