The crypto market is a global one and looking at the different trends within it shows how different countries respond to the asset class. One country that has especially been enthusiastic about the crypto space is South Korea. While much of the attention in the crypto space is given to Western countries like the United States and Canada, the figures coming from South Korea are nothing to scoff at.
In fact, a recent report from Tiger Research shows that the country stands shoulder-to-shoulder with other world powers in terms of crypto.
Details From the Report
It is worth remembering that 2024 has been an especially good year for the crypto sector. Not only did we see a Bitcoin and Ether spot ETF launched in the United States, but a growth in new tokens being launched. The meme coins scene was especially popular, with many coins raising millions at presale and then going on to perform well in the market. All this is even before we consider legacy tokens like Dogecoin and Pepe, which continue to be popular. As Kane Pepi writes, more people are looking to buy meme coins than ever before (source: https://cryptonews.com/kr/cryptocurrency/best-meme-coins).
As such, it makes sense that South Korea’s numbers for the year have been so high. In fact, the report shows that 15% of the population, about 7.78 million people, have been actively buying and using crypto. In the first quarter of the year, crypto-fiat transactions completed using the Korean Won even surpassed that of the US dollar. While the US dollar eventually regained its position, the Korean Won has been second for the last two quarters, even higher than the Euro and the Japanese yen.
All this, the report explains, is caused by a phenomenon called the kimchi premium. The report defines the kimchi premium as, “the price difference between local and global exchanges, a distinct feature of the Korean market. Often marked by high volatility, the premium can vary significantly with market conditions”.
This premium is further informed by the high risk-taking behaviour of Korean investors as well as the restrictions around traditional investment markers in the country. As such, the crypto market offers a way to get around these issues, and investors have happily taken it. And as long as this continues, the crypto market will only grow within the country.
XRP and Doge at the Forefront
It was uncovered that Upbit is the largest crypto exchange in South Korea and accounts for 70% of its current transaction volume. Based on this, we can see that Dogecoin and XRP are some of the most popular tokens among Koreans. While Bitcoin was the most popular asset for the first three quarters of the year, XRP and Doge were always in the second and third positions, even ahead of Ether. By Q4, they had overtaken Bitcoin altogether, indicating that meme coins and cross-border payments are a priority for this market.
How This Compares to Others
South Korea has clearly shown that it is passionate about crypto, reporting a healthy adoption rate and transaction figures, but how does this stack up to other countries? According to the 2024 Chainalysis Crypto Adoption Index, Canada tracks just ahead of South Korea in terms of adoption. Further data from Statista pegged crypto adoption in Canada at 9%, which is 6% lower than in South Korea. Given that the populations have a difference of just about 10 million, it can be argued that adoption rates are roughly neck-and-neck.
When we compare what specific cryptos are popular, things get even more interesting. According to CoinMarketCap, the most popular CAD-crypto trading pairs are Bitcoin, Litecoin, Ethereum, XRP, and Bitcoin Cash. While tokens like Bitcoin, Ethereum, and XRP seem to be popular in both Canada and South Korea, Dogecoin is noticeably absent from the top 5. This suggests that Canadians have a much lower appetite for meme coins compared to others. Given how big of a year meme coins have had globally, this is rather surprising.
Still, it is clear that South Korea is well on its way to becoming a force in the crypto sector in East Asia and beyond.
