South Korea’s Virtual Asset Market Shrinks 33% in First Half

South Korea’s virtual asset market contracted sharply in the first half of 2026 as major cryptocurrency prices declined, according to data released by the Financial Services Commission on Thursday.

The total market capitalization of virtual assets traded in the country stood at 58.9 trillion won, or about $43.4 billion, at the end of June. That was down 33 percent from 87.2 trillion won six months earlier, indicating that the downturn extended beyond day-to-day price volatility and substantially reduced the value of the domestic market.

Trading activity weakened alongside market value. Average daily turnover fell to 3.1 trillion won during the period, compared with 5.4 trillion won previously. The decline suggests that investors traded less actively as cryptocurrency prices came under pressure.

Funds held in Korean won deposits at virtual asset operators also dropped. Such deposits declined by 2.9 trillion won, or 35 percent, to 5.2 trillion won over the January-to-June period. Won deposits are money that customers keep at trading platforms and can use to buy virtual assets, making the figure an indicator of immediately available trading funds.

The number of market users, however, edged up by 0.4 percent to about 11.17 million. The contrast between a slightly larger user base and steep declines in market capitalization, turnover and deposits shows that participation did not disappear even as the financial scale of activity diminished.

South Korea had 26 virtual asset market operators at the end of June, including 17 cryptocurrency exchanges, the regulator’s data showed. The market offered 1,703 types of cryptocurrency, including Bitcoin, Ethereum and Dogecoin. That tally was 29 lower than six months earlier.

The figures present a broad snapshot of a major retail cryptocurrency market during a period of falling asset prices. They also show that the first-half retreat was visible across several measures: the value of traded assets, daily transactions and cash held for trading all moved lower.

For regulators and market operators, the combination of millions of users and reduced trading intensity underscores the continued importance of market oversight even during a downturn. For investors, the data illustrate how quickly changes in the prices of leading cryptocurrencies can affect the overall size and liquidity of South Korea’s virtual asset sector.