Apr 16, 2024 at 05:34In a significant development, the South Korean won has emerged as the most actively traded fiat currency against cryptocurrencies in the global market during the first quarter of 2024.
Research conducted by Kaiko revealed that the trading volume denominated in the won reached over $456 billion on centralized crypto exchanges, surpassing the $455 billion recorded in U.S. dollar volume.
Kaiko attributes this surge in the won’s dominance to the ongoing “fee war” among South Korean crypto exchanges. The report highlights the competitive landscape and improving macroeconomic conditions as key factors driving trading volume to its highest levels in over two years, particularly in early March.
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Euro-denominated trading pairs, by comparison, accumulated a total volume of $59 billion, securing the third position in terms of cumulative trade volume for the first quarter of 2024.
The competition among South Korean exchanges intensified during the recent bullish market, notably with Bithumb and Korbit launching zero-fee campaigns in late 2023. Although Korbit’s market share remained modest, Bithumb saw a significant increase in its market share following the introduction of zero-fee trading. However, this aggressive strategy led to a substantial revenue decline for Bithumb, prompting the exchange to discontinue the campaign just five months after its launch.
Despite a temporary decline in volumes for the Korean won in early April, analysts anticipate a notable rebound following the approval of spot Bitcoin and Ether exchange-traded funds (ETFs) in Hong Kong. Hong Kong’s financial regulator’s approval of three spot Bitcoin ETFs, scheduled to list on the Hong Kong Stock Exchange in approximately two weeks, is expected to further invigorate trading activity.
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