- On the Korean exchange Upbit, altcoin dominance accounted for 87% of the total trading volume in January.
- Investors also showed interest in Bitcoin and Ethereum.
The Korean market has seen strong demand for cryptocurrencies over the past few years and has often been a key driver of increased altcoin trading volume.
Korean exchanges increase altcoin trading volume
According to Joo Ki-young, an on-chain analyst and CEO of CryptoQuant, Upbit, Korea’s largest exchange, had an altcoin share of 87% in total trading volume in January.
A closer look shows that altcoins will still account for a significant portion of trading volume in 2023.
In comparison, Coinbase, the largest cryptocurrency trading platform in the US, had only 45% of its trading activity dominated by altcoins.
Source: CryptoQuant
For those who are not yet familiar with it, Korean Due to regulations on institutional investors, the market is mostly comprised of individual investors.
Coinbase, on the other hand, is considered a gateway for institutional investors to purchase cryptocurrencies. Their focus has historically centered around Bitcoin (BTC) and Ethereum (ETH).
As a result, these two major assets controlled a significant portion of the volume pie.
Korean investors are showing interest in Bitcoin and Ethereum
Historically, Korean exchanges have had higher prices for popular tokens compared to foreign exchanges. This phenomenon is called the kimchi premium and is driven by high demand for domestic cryptocurrencies.
But the appetite wasn’t limited to altcoins. Recently, individual investors in Korea have also shown interest in purchasing Bitcoin.
As a result of AMBCrypto’s analysis of CryptoQuant data, the index representing the percentage difference in Bitcoin prices between domestic exchanges and other exchanges soared.
This means more investors are willing to pay a premium to purchase.
Source: CryptoQuant
A similar trend was observed in Ethereum demand in the Korean market.
Korean cryptocurrency market punches above its weight
According to data highlighted by Joo Ki-young, the trading volume on Korean exchanges was about 31% of Binance, the world’s largest cryptocurrency trading platform. This is despite the global influence of Korean exchanges being only 12%.
Source: CryptoQuant