Key highlights:

  • Upbit and Bithumb saw sharp revenue declines in the second quarter of 2026, continuing a year-long trend
  • Upbit’s operating profit sank 73% from Q1 2027 while Bithumb’s revenue fell by 35% over the last 12 months
  • Crypto investors are turning their attention toward the country’s booming stock market

South Korea’s two largest cryptocurrency exchanges reported weaker Q2 results as declining trading activity and shifting investor interest weighed on the domestic digital asset markets. Upbit operator Dunamu and rival Bithumb both posted sharp declines in key financial metrics, underscoring the cooling of South Korea’s crypto trading market.

Why Upbit and Bithumb's revenues tanked

According to public disclosures, UPBIT operator Dunamu reported Q2 revenue of 173.5 billion won ($123 million), down by 26% from the first quarter of the year. Per the statement, operating profit tumbled by a staggering 73% quarter over quarter to 23.5 billion won.

Meanwhile, Bithumb also suffered a sharp deterioration in its financial performance in the first half of the year. The South Korean exchange reported Q2 revenue of 86.3 billion won, a jarring 54.8% year-over-year, while operating profit tanked by 44% to 12.1 billion won.

The company swung to a 21.8 billion won net loss from a 22 billion won profit in the same quarter last year. Bithumb’s first-half revenue fell 48.7% from last year to 168 billion won, while its cumulative net loss reached 108.7 billion won.

Upbit and Bithumb attributed the deterioration to shrinking liquidity in the global digital asset market and weaker investor sentiment. Notably, trading activity across South Korea’s major exchanges has fallen from its previous highs, dealing a major blow to the earnings of service providers.

Both exchanges earn a significant slice of their revenue from trading fees, with their latest financial data mirroring the decline in market activity. A year ago, the combined trading activity of the top five largest South Korean crypto exchanges topped $2.82 billion. At press time, the figure is less than $500 million, with South Korean crypto investors turning their gaze elsewhere.

South Korean investors turn their attention to stocks

While Upbit and Bithumb are grappling with falling revenues, South Korea’s stock market is recording an influx of capital. In the first half of 2026, the Korea Composite Stock Price Index (KOSPI) nearly doubled, making it the world’s best-performing major equity market over the period.

The AI boom buoyed the rally, with demand for advanced memory chips from Samsung Electronics and SK Hynix sending KOSPI on a strong rally. South Korea’s retail investors piled in, using leveraged ETFs and margin financing to bet on technology stocks.

A raft of government reforms triggered the South Korean stock market rally. Particularly, corporate-governance reforms and changes to dividend taxation made Korean equities attractive to global investors.

Meanwhile, several crypto scams also saw a capital flight from the local digital asset markets. While a recovery is still far off, authorities are clamping down on bad actors, securing the convictions of several crypto fraudsters.