South Korean Crypto Investors Transfer 25.3 Trillion KRW to Overseas Exchanges Amid Improved Market Conditions

In the second half of last year, domestic cryptocurrency investors in South Korea transferred KRW 25.3 trillion to overseas exchanges. This surge was driven by improved market conditions, which prompted investors to trade newly emerged virtual assets unavailable in Korea or to capitalize on price differences between exchanges.

According to the Financial Intelligence Unit (FIU) of the Financial Services Commission’s survey, the total amount of virtual assets withdrawn from domestic exchanges was KRW 38.1 trillion. Of this, KRW 10.4 trillion (27%) involved transfers exceeding KRW 1 million, subject to the ‘travel rule’ for tracking such transactions.

Transfers to pre-registered overseas businesses or individual wallets totaled KRW 26.9 trillion (71% of withdrawals), marking a 22% increase from the first half of the year. Of these transfers, 67% (KRW 25.3 trillion) went to overseas exchanges, while 4% (KRW 1.6 trillion) went to personal wallets. The remaining 2% (KRW 800 billion) were smaller transfers not covered by the travel rule.

This pattern indicates that most large transfers were to overseas exchanges, often to use platforms with greater liquidity or to trade cryptocurrencies not listed domestically. Investors typically buy cryptocurrency on domestic exchanges with Korean won before transferring it abroad. The FIU noted a significant increase in these outward transfers, suggesting purposes like arbitrage.

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