South Korean Crypto Market Suffers Massive Outflow of Funds

South Korea's cryptocurrency market has been experiencing a significant decline in liquidity due to a massive outflow of funds from domestic exchanges.

A report by the Financial Services Commission revealed that approximately $60 billion worth of virtual assets left Korea's crypto market and moved to overseas platforms or personal wallets between July and December last year.

This trend is attributed to regulations such as crypto taxation, which are set to be implemented next year, and limited investment options in the domestic market. Analysts point out that Korean investors are being drawn to broader investment choices available on overseas exchanges, including leveraged trading, a wider range of coins, and DeFi.

As a result, stablecoin balances at Korea's five major exchanges have fallen by more than 50%, from around $575 million in July last year to about $188 million recently. Average daily trading value has also dropped by over 30%.