The cryptocurrency exchange market in South Korea undergoes a significant contraction, the number of negotiation companies for registered crypto felling more than 26% in the past year.
In February 2025, only 31 registered cryptography exchanges remained operational in South Korea. It is a strong fall of 42 exchanges at the beginning of 2024.
On February 7, 2025, local media reported that “the number of national virtual asset service providers (VASP) decreased compared to last year”.
The decline, as underlined in a recent report by the Financial Intelligence Unit (FIU), shows the challenges posed by strict regulatory requirements.
In addition, the lack of regulatory clarity has forced smaller exchanges out of the market.
Comparison of cryptographic taxation: United States, India and South Korea
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David Sacks, head of the American crypto policy, confirmed that the Trump administration prioritizes bitcoin as a strategic reserve. With major regulatory changes … pic.twitter.com/tvl83tyxkd– Cobak (@cobakofficial) February 5, 2025
The Trump administration prioritizes Bitcoin reservesGDAC, Probit, Huobi Korea, Bitrade closed its doors
“The exchanges of the parts market have been bankrupt one after the other due to management difficulties since last year,” said the report, “but they officially stayed on the list of commercial operators because their licenses were maintained for a certain period. “
Notable closures include GDAC, Probit, Huobi Korea and Bitrade.
Most of these delimited companies were “only” platforms that lacked fiduciary money negotiation options, such as the Korean dollar or the US dollar. Without real bank accounts – a regulatory requirement for Fiat transactions – these platforms have struggled to attract users and maintain their operations.
The FIU report revealed that more than 90% of these token scholarships were only faced with “full capital erosion” last year. This led to generalized closures. Exchanges like Qubit and Coinbit are among those who stop. This was due to financial insolvency and the failure to renew their registrations.
The South Korea regulatory framework for cryptocurrencies has evolved rapidly in recent years. While aiming to improve the protection of investors and the integrity of the market, these regulations have also created obstacles to important entry for small players.
Recently, the greatest cryptocurrency exchange in South Korea, Upbit, was under intense regulatory control. After being accused of having violated more than 700,000, know your client (KYC) and the anti-money laundering obligations (AML), Upbit faces the suspension.
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The new South Korea platform designed to enter the digital assets of tax evigorates
According to South Korean local media reports dated February 3, 2025, Gwacheon City has announced the use of IT solutions to enter and liquidate the cryptographic assets of tax evigorating.
The regulators aim to use this platform to identify cryptographic portfolios belonging to the city’s tax escapes. The authorities have so far identified 361 high income citizens who have not paid tax on their cryptography gains
The authorities believe that internet users identified hide their wealth in cryptographic assets to avoid paying heavy taxes. The average amount being 18.8 billion wons, unpaid taxes have been calculated at more than 3 million won.
There is still an agreement to be concluded in South Korea concerning cryptographic taxes.
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The post this week in Crypto Asia: the South Korea Crypto exchange market shrinks by 26% appeared first on 99Bitcoins.
