Kimchi Cooled: Korea's Q1 Crypto Volume Slips to ₩98.1T as the Market Grows Up 🍲

Average monthly trading volume on South Korea's five largest won-based exchanges—Upbit, Bithumb, Coinone, Korbit, and Gopax—fell from ₩125.2 trillion to ₩98.1 trillion in Q1 2026, according to market data. The decline reflects a rotation toward long-term holdings, capital flowing into South Korea's stock market, rising oil prices, and higher interest rates that have reduced appetite for risk assets. Upbit and Bithumb continue to control roughly 96% of trading volume on those venues, and regulators are working to ease that concentration through ownership caps under the Digital Asset Basic Act (DABA) Phase 2. The legislative push gained urgency after Bithumb's February 2026 promotion error disbursed Bitcoin [$BTC] instead of small cash prizes, briefly triggering a 17% flash crash in the BTC/KRW market. Lawmakers are also weighing who will be permitted to issue won-backed stablecoins under DABA Phase 2, with the Bank of Korea favoring bank-led issuance and the Financial Services Commission backing participation from any eligible entity. KRWQ, a won-pegged stablecoin launched on Base in late 2025, had reached daily volume of roughly ₩1 billion by April 2026, driven largely by foreign institutions using it to hedge exposure to South Korean equities—a pattern that has prompted concerns about offshore control of won-denominated liquidity. The persistent Bitcoin "Kimchi Premium" continues to illustrate how South Korea's capital controls shape its crypto market. Upbit operator Dunamu introduced GIWA, an Ethereum Layer-2 network built on the OP Stack, to support regulated institutional activity through multi-chain compatibility, identity verification, and rapid settlement. Separately, Tether filed seven trademark applications with South Korea's KIPRIS database, including the marks KRWT and WONTETHER, both referencing the Korean won.