South Korea's cryptocurrency exchange market is currently undergoing a dramatic bifurcation. While major players are achieving unprecedented valuations and preparing for public offerings, smaller competitors are grappling with severe financial strain and contemplating strategic retreats. This divergence paints a clear picture of a consolidating industry where scale and market dominance are becoming increasingly critical for survival.
Market Leaders Soar Towards Public Offerings
Leading the charge are industry giants Dunamu (operator of Upbit) and Bithumb, both witnessing explosive gains in their share prices. Their valuations have been significantly buoyed by renewed investor optimism and Bitcoin's recent surge to new yearly highs. Both exchanges reached peak private share prices in early July, signaling strong investor confidence in their market leadership. Leveraging this momentum, both companies are reportedly gearing up for public offerings. Bithumb, in particular, has set its sights on a Kosdaq listing targeted for late 2025. Dunamu's continued dominance through Upbit also fuels speculation around its own potential IPO. Together, these two exchanges command an overwhelming 96% of the local crypto market share.
Smaller Players Face Mounting Pressures
In stark contrast, smaller rival Coinone, holding a mere 3% of the market, is confronting considerable financial pressure. The exchange recently opted to sell off $2.96 million worth of its digital assets, representing about 10% of its total crypto holdings. This decision marks the first such action under South Korea’s updated regulatory framework, introduced in May 2025. These new rules permit exchanges to liquidate portions of their holdings for operational funding, provided sales are pre-disclosed and limited to top-20 cryptocurrencies. Coinone's rationale for the sale indicates a liquidity shortfall, with funds earmarked for essential operational expenses like staff salaries, rather than expansion. This strategic retreat underscores the mounting difficulties faced by smaller players in an increasingly competitive and tightly regulated environment. Survival for these entities will likely hinge on radical strategic pivots or potential acquisitions, as the market continues to consolidate around its dominant forces.
