Over $110 Billion in Cryptocurrency Left South Korea in 2025 Amid Strict Trading Regulations
In 2025, South Korea experienced significant cryptocurrency outflows totaling over 160 trillion won (approximately $110 billion) as assets moved from domestic centralized exchanges (CEXs) to foreign platforms. This trend is attributed to the country's strict domestic trading rules, which have constrained local exchanges and driven users to overseas markets.
The Digital Asset Basic Act (DABA), initially anticipated to provide clearer regulatory guidance, was delayed in December 2025 due to disagreements among regulators over stablecoin issuance. This delay contributed to a regulatory gap in the South Korean crypto market.
Currently, the Virtual Asset User Protection Act, effective since 2024, governs aspects of the market but does not address critical market structure issues such as leverage or derivatives trading. As a result, domestic exchanges are mostly confined to spot trading without access to leveraged derivatives and other complex financial products that foreign exchanges offer.
This limitation has diminished the competitiveness of South Korea's domestic CEXs relative to offshore platforms, encouraging investors to hold larger sums on overseas accounts. According to Aju Press, overseas cryptocurrency holdings by South Korean investors reportedly doubled within a year.
South Korea's investor base is estimated at about 10 million individuals, with exchanges like Upbit and Bithumb still generating revenues in the trillions of won. Although overall crypto activity shows growth, the domestic market expansion has stagnated while more activity shifts to international platforms such as Binance and Bybit.
This analysis is part of joint research conducted by CoinGecko and Tiger Research, recognizing South Korea as one of Asia's most active digital asset markets despite regulatory challenges.
