The South Korean crypto market has marked some big winners. Bithumb, one of the country’s most prominent crypto exchanges, has reported an operating profit of $645 million for the year 2021.
South Korea’s Bithumb’s annual profit skyrockets
Bithumb revealed this in its 2021 revenue report filed recently. The report also noted that Bithumb accounts for about 10% of the South Korean crypto market, with an annual operating income of about $833 million.
The exchange also made massive profits from its investments outside of crypto trading. One of its highlights from last year was its investment in the viral Netflix series, Squid Game, from which it made over 100% profit from its $12.6 million investment in Bucket STUDIO which made the franchise.
Meanwhile, the exchange’s rise has not been without some controversy. Last year, Bithumb’s de facto owner Lee Jeong-hoon, came under investigation for alleged mismanagement and questionable business dealings. Korean Daily intimated that the allegation involved Lee defrauding an investor of around $100 million in 2019.
However, Bithumb is only one of the key players in the South Korean crypto market. They share market dominance with Upbit, Korbit, and Coinone – with Upbit boasting the biggest market share according to a survey conducted by the Korean Financial Intelligence Unit (KoFIU).
The survey, which was the first of its kind in the country involved 29 virtual asset service providers (VASPs), with four being Korean won-based exchanges, 20 coin-only exchanges, and five digital asset wallets. KoFUI is a division of Korea’s financial watchdog the Financial Service Commission (FSC).
The report disclosed that in 2021, South Korea’s digital asset market recorded explosive growth to hit $46 billion. Meanwhile, from Q1 to Q3 in 2021, the total operating profit earned by VASPs stood at $2.77 billion.
The country’s citizens were also shown to be more actively trading cryptocurrencies and increasing the size of their investments.
At the end of December 2021, 3.13 million users (56%) held virtual assets worth KRW1 million or less. About 15 percent of users (82,000) held virtual assets worth KRW10 million or more, the survey found.
Adding that in Q4 2021, users on average traded four times a day, each time about KRW750,000.
Other parts of Asia reflect South Korea’s crypto appetite
On the back of growing adoption, the country has been driving to put regulations for the industry in place. The incoming president of the country has promised to make crypto one of his top mandates and to open up the country to crypto investments.
The story of crypto adoption is similar in other Asian countries. Countries like the Philippines, Singapore, and India are seeing massive waves of adoption of crypto, as well as NFTs. This has been despite uncertain, and like in the case of India unfavorable, regulations for the industry as asserted by TechInAsia.