Since the invention of blockchain and digital assets, there has been an increase in interest in Cryptocurrency among South Korean residents. Now, South Korea has become one of the major players in the cryptocurrency space, and it’s home to exchange giants like BitHumb, CoinOne, Upbit, and Korbit.
Furthermore, the Korean market accounts for up to 30% of all cryptocurrency trading globally. Following that, the South Korean legalization of cryptocurrencies and crypto exchanges in March 2020 has contributed to an increase in the number of cryptocurrency investors.
According to a poll conducted by the Korea Financial Investment Association in 2022, the average South Korean cryptocurrency trader grew their crypto holdings by 64.2% over the previous year.
Many young South Koreans are now abandoning their low-paying occupations to delve into the world of cryptocurrency as a means of creating wealth and living the life they wish. This has piqued the world’s interest in why is Cryptocurrency trading popular in South Korea and that is why we’ve put together this piece.
This post will look at some of the reasons why cryptocurrency trading is popular in South Korea.
The State of Crypto in South Korea
South Korea has long been tagged as Asia’s crypto hub. According to Forkast, 31% of South Korean investors are in their 30s, 27% are in their 40s, and 25% are in their 20s.
South Korea is a home to exchange titans like BitHumb, CoinOne, Korbit, and Gopax. Although crypto assets have not been authorized as official tender by the South Korean government, it is now permissible to own, sell, and buy them in the country.
Additionally, as seen by the last presidential election, in which Yoon Suk-yeol, a pro-crypto politician, was elected. South Korea appears to be on the path to solidifying its supremacy as the Asia-wide crypto hub. Pro-crypto legislation and policies are already being set in places, such as the suggestion for more benevolent tax regulations and the potential comeback of ICOs and IEOS.
READ ALSO: How to Make Cryptocurrency a Part of Your Portfolio
Why Is Cryptocurrency Trading Popular In South Korea?
It is amazing how South Korea has less than 1% of the world’s population, but it is a prominent player in the crypto industry. Moreover, it is believed that the average crypto holder in Korea invests at least $900 in their wallet. This is due to the belief that cryptocurrency is the future of finance. The following are more reasons why cryptocurrency trading is popular in South Korea.
#1. High Technological Interest
South Korea has a long history of being known for embracing and adopting new technologies more quickly than any other country. Korea currently has the fastest internet and a sophisticated telecommunications network.
Technology has thus become ingrained in the national identity as a motivating factor and a major contributor to the nation’s economic advancement.
Now, South Koreans are so used to digitization that new forms of technology, and new ways of interacting with technology, are quickly absorbed into its mainstream culture. This has continually demonstrated that it has no problem giving high value to digital assets, which has helped in skyrocketing the trading of cryptocurrency in the country.
Given that, South Korea had already begun to become accustomed to all types of payment. As a result, the country’s interest in cryptocurrencies had shifted, adding to the country’s growing popularity of cryptocurrency.
#2. Hyperconnectivity
In blockchain technology, the major driver of new trends is the strength of networks. Thus, social media has played a significant impact in the adoption of cryptocurrencies in Korea. Blockchain interest groups and trading circles operate through tightly knit channels. When cryptocurrency took off in late 2017, everyone wanted in. As a result, people of all age types dive into the crypto market.
#3. Economic Problems and Unemployment
The prevailing economic situation in South Korea is one of the reasons why cryptocurrencies started growing massively in the country. The South Korean economy, despite being a sizable and successful one, faces an issue of youth unemployment. In 2021, the unemployment rate rose to 11%.
However, it eventually fell to around 8.8% after the government announced a program to encourage small and medium-sized businesses to hire young workers.
Nonetheless, a consistent and stable source of income was also required to meet the high cost of living and competitive work employment rate. This spur more young people into exploring the world of crypto, contributing to the popularity of cryptocurrency trading in South Korea.
#4. Political Unrest
The final reason for cryptocurrency trading’s popularity in South Korea is political unrest. The primary issue is North Korea, which has significantly increased its nuclear capabilities in reaction to the possibility of an American invasion.
Early in 2021, the country displayed what was dubbed “the most potent weapon in the world,” a submarine-launched ballistic missile. This was displayed just a few days before Joe Biden took office as president of the United States, this announcement was made under Kim Jong-un’s supervision at a parade.
Because most nations do not have Cryptocurrency bans, investors can invest in any coin regardless of the circumstances in North Korea.
FAQs About Why Is Cryptocurrency Trading Popular In South Korea?
Although cryptocurrency trading is permitted, it is not considered legal tender in South Korea.
Yes! Cryptocurrencies are popular investments among South Korea’s youthful population. This is because they are regarded as a means of accumulating lasting wealth and reducing the country’s high unemployment rate. South Korea has historically been an early adopter of new technologies, and as a result, crypto trading is now allowed.
A report from May 2021 states that the combined user base of South Korea’s top four cryptocurrency exchanges, Upbit, Bithumb, Coinone, and Korbit, is predicted to be around 5.85 million.
The first crypto exchange in South Korea is Korbit. It has a sizable amount of venture capital funding. The platform, which supports both Korean and English, is well-liked by its users and enables them to purchase crypto using the local fiat money, the South Korean Won (KRW).
Yes! One of the nations with the highest levels of cryptocurrency activity in South Korea.
The following are our best picks for cryptocurrency wallets in South Korea.
Coinomi.
MetaMask.
XDEFI Wallet.
Ledger Nano S Plus.
Trezor Model T.
Crypto.com DeFi Wallet.
Conclusion
South Korea has a reputation for embracing new technology, and as unemployment rises, so does the likelihood of being financially independent. Young people are busy exploring the crypto market and many have been milking the market to date.
Following the COVID-19 pandemic, interest in digital assets surged, prompting the South Korean government to establish cryptocurrency exchanges and develop a strategy to prevent money laundering to support the development of the cryptocurrency industry.
This legislation was a success for the people of South Korea because a big number of investors indicated their total interest in purchasing and holding digital assets from the cryptocurrency market. All this is because cryptocurrency is being regarded as the future of finance. We hope this post has helped to address the question of why cryptocurrency trading is so popular in South Korea.