CRYPTO INSIGHT 06
Korean Crypto Exchanges — More Accounts, Less Profit
Falling trading turnover and the limits of fee-dependent business models
Key Conclusion
With trading fees accounting for 99.7% of revenue at Korean KRW-market exchanges, earnings depend on fee-generating activity, economics after discounts and incentives, and cost flexibility more than on account totals. In the first half of 2026, accounts eligible to trade increased slightly, but costs fell more slowly than revenue, amplifying the decline in operating profit. This period alone does not establish long-term industry decline, and diversification should be judged by recurring profit after amounts owed to customers and direct operating costs.
Research Summary
In the first half of 2026, the 17 Korean exchanges covered by the FIU survey generated KRW 576.8 billion in revenue and KRW 81.6 billion in operating profit, down 41% and 78% from the preceding half-year. Yet accounts eligible to trade reached 11.175 million at end-June, up 0.4% from the previous year-end. These KYC-completed accounts include duplicates across operators and do not measure actual trading activity or retention within the same customer cohort.
Trading fees accounted for 99.7% of revenue at KRW-market exchanges. Across the surveyed exchanges, operating costs calculated as revenue less operating profit fell 17.3%, from KRW 598.8 billion to KRW 495.2 billion, lagging the revenue decline. The operating margin fell from 38.5% to 14.1%. Trading turnover and market share therefore need to be assessed alongside economics after discounts and rewards, and the speed at which costs adjust.
Dunamu and Bithumb filings require attention to reporting scope and revenue recognition. Gross recognition of staking rewards is different from the exchange's economic compensation, while customer deposits are not proprietary funds available for unrestricted distribution. Growth in revenue beyond trading fees or assets under custody alone does not establish an improved business model.
The downturn does not demonstrate permanent demand destruction. Earnings could recover rapidly if trading improves while cost growth remains limited. A stronger assessment of diversification, however, requires new businesses to generate recurring contribution after customer rewards and direct costs, stabilising overall earnings even when the core trading business is weak.
Key Points
- Growth in accounts eligible to trade does not establish stronger activity, more unique users or better retention. The question is whether the account base converts into fee-generating transactions.
- Exchange revenue fell 41%, while operating costs calculated from revenue and operating profit declined 17.3%. The limited cost offset amplified the operating profit decline to 78%.
- Trading fees represented 99.7% of revenue at KRW-market exchanges. Crypto-only exchanges, where trading fees represented 8.3% of revenue, also recorded an operating loss. Revenue mix alone does not establish profitable diversification.
- Dunamu and Bithumb results require comparable reporting scope and revenue recognition. Customer deposits and the customer share of staking rewards must be distinguished from profit available to the exchange.
- A trading recovery and an improved business model are different outcomes. New businesses must demonstrate recurring profit after customer rewards and direct costs that cushions the core business during weak trading periods.
Sources and corrections
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