Catenaa, Friday, August 21, 2026-South Korea’s two largest cryptocurrency exchanges saw revenue collapse by roughly half in the first six months of 2026 as falling crypto prices, weaker trading and a powerful domestic stock rally pulled investors away from digital assets.
Dunamu, operator of market leader Upbit, reported consolidated first-half revenue of 408.1 billion won, about $289 million, down 49.1% from a year earlier.
Operating profit plunged 79.7% to 111.5 billion won, while net profit fell 74.1% to 108.4 billion won.
Bithumb suffered a similar revenue contraction.
Its first-half revenue declined 48.7% to 168.8 billion won, about $120 million. Operating profit dropped to 14.9 billion won from 90.1 billion won a year earlier.
More damaging was its bottom line.
Bithumb recorded a net loss of 108.7 billion won after reporting a 55 billion won profit during the same period last year.
The results reflect a sharp decline in activity across South Korea’s once highly active retail crypto market.
Combined second-quarter trading volume across Upbit, Bithumb, Coinone, Korbit and Gopax fell 49.5% from a year earlier to about $146.4 billion.
That decline directly affects exchange earnings because transaction fees remain their main source of revenue.
Upbit generated the overwhelming majority of Dunamu’s operating revenue during the period, while almost all of Bithumb’s revenue came from trading commissions.
The figures expose a basic weakness in exchange economics.
When crypto markets rise and retail trading accelerates, fee revenue can expand rapidly. When turnover collapses, revenue falls almost immediately while technology, compliance and staffing costs continue.
Crypto was also competing with an unusually powerful alternative for Korean investors.
South Korea’s stock market surged during the first half of 2026 as global demand for artificial intelligence hardware pushed semiconductor shares sharply higher.
Samsung Electronics and SK Hynix became the center of that rally as investors sought exposure to memory chips required by AI data centers.
The benchmark KOSPI more than doubled during the first half, producing one of the strongest major equity-market performances globally.
That created an unusual domestic capital rotation.
Instead of moving primarily between Bitcoin, altcoins and cash, Korean retail investors had another speculative market offering large short-term gains.
Money moved toward semiconductor shares and other AI-linked equities while crypto liquidity weakened.
Bitcoin fell more than 30% during the first half, moving from roughly $90,000 at the beginning of the year toward $60,000 by the end of June.
Ether performed worse, dropping from around $3,000 to approximately $1,600.
The contrast gave Korean traders fewer reasons to remain heavily exposed to domestic cryptocurrency exchanges while equities were delivering far stronger returns.
Another sign of weakening Korean crypto demand has emerged in the country’s famous Bitcoin price premium.
Historically, Bitcoin has frequently traded at a higher price on South Korean exchanges than on offshore platforms.
The difference became known as the kimchi premium and was often viewed as an indicator of strong Korean retail demand.
That premium has recently weakened and at times reversed.
Local market data cited by BizWatch showed the premium ranging from about 0.02% to negative 2.01% between Aug. 1 and Aug. 16.
A negative reading means Bitcoin was sometimes cheaper in South Korea than in overseas markets.
That is a striking reversal for a market once known internationally for aggressive retail demand.
The revenue downturn comes while Dunamu is pursuing a broader corporate restructuring.
The company is working toward a share-swap transaction with Naver Financial that would make Dunamu a wholly owned subsidiary of the fintech unit controlled by South Korean internet giant Naver.
The combined business has discussed pursuing a public listing within five years, potentially in the United States.
Traditional finance is also moving closer to Dunamu.
Hana Financial Group acquired a 6.55% stake this year and agreed to cooperate on areas including won-backed stablecoins, blockchain remittances and digital-asset services.
Three Samsung affiliates subsequently acquired a combined stake of about 4%.
Those transactions suggest that declining spot-trading revenue has not eliminated institutional interest in Korea’s largest crypto platform.
Bithumb is pursuing its own restructuring.
The exchange is targeting an initial public offering in 2028 after earlier listing plans were delayed.
Its roadmap includes strengthening internal controls this year before seeking preliminary listing review in 2027.
Bithumb has also been exploring international expansion and new financial partnerships.
Kiwoom Securities entered discussions over a possible investment, while Bithumb has partnered with SSI Digital as part of plans to expand into Vietnam.
The strategy could help reduce dependence on Korea’s spot crypto market over time.
Catenaa View
The first-half results expose a challenge that extends beyond falling Bitcoin prices.
South Korea’s crypto exchanges are competing for investor attention and capital against other financial markets.
During previous crypto downturns, dormant retail capital could remain available for the next digital-asset rally.
The AI boom changed that equation.
Samsung Electronics, SK Hynix and other semiconductor investments offered Korean investors another high-volatility, high-return trade within the regulated domestic stock market.
That helps explain why crypto exchange revenue fell almost in tandem with trading volume.
The disappearance of the kimchi premium reinforces the same message.
South Korea has not stopped being a major crypto market. But the extraordinary retail enthusiasm that once made Korean exchanges global price drivers has weakened.
For Upbit and Bithumb, the response is already becoming visible.
Both are seeking deeper links with traditional finance, new products, institutional customers and overseas markets.
If trading fees remain their dominant source of revenue, however, the next earnings recovery will still depend heavily on one old variable: getting Korean traders back in front of crypto order books.
South Korea has long been one of the world’s most active retail cryptocurrency markets. Upbit and Bithumb dominate domestic trading, alongside Coinone, Korbit and Gopax. Strict local rules have historically limited corporate participation and restricted some products available on overseas exchanges. Korean traders became known for producing a persistent Bitcoin price premium during periods of strong demand. In 2026, however, weakening crypto prices coincided with an extraordinary domestic equity rally driven by AI-related semiconductor demand. That combination has reduced crypto turnover just as both major exchanges are pursuing corporate restructuring, institutional partnerships and potential public listings.
