Upbit and Bithumb, South Korea's two largest cryptocurrency exchanges, have reported significant declines in revenue and profits for the first half of 2026, with both platforms seeing roughly 50% drops compared to the same period last year. The results reflect a broader slowdown in Korean crypto trading activity that has implications for global market liquidity.
The Scale of the Decline
Both exchanges saw their H1 2026 revenue and operating profits fall by approximately half year-over-year. The decline tracks with broader trends in the crypto market, where trading volumes have compressed significantly from the peaks of 2024 and early 2025. Lower volatility, reduced retail participation, and tighter regulation have all contributed to thinner trading activity.
For Upbit, operated by Dunamu, the decline is particularly notable given the exchange's historical dominance of the Korean market. Upbit has consistently accounted for the majority of Korean crypto trading volume, and its performance is often viewed as a barometer for retail sentiment in one of the world's most active crypto markets.
Why Korean Trading Matters Globally
South Korea has long been one of the most important markets for cryptocurrency trading. The Korean premium, or kimchi premium, which measures the difference between Bitcoin prices on Korean exchanges and global venues, has historically been a signal of retail demand. When Korean trading volumes are high, they can influence global price discovery; when they fall, global liquidity can suffer.
The decline in Upbit and Bithumb's revenue suggests that Korean retail investors are reducing their crypto exposure, which could reduce the liquidity available for major tokens. This matters particularly for tokens that have strong Korean trading communities, where local exchange volume can represent a significant portion of global activity.
Factors Behind the Slowdown
Several factors are likely contributing to the Korean exchange decline. Tighter regulatory oversight under the country's crypto framework has increased compliance costs and restricted some trading activities. The broader market's range-bound trading has reduced the speculative activity that drives exchange revenue. And competition from decentralized exchanges and overseas platforms may be diverting some volume away from the domestic leaders.
The decline also reflects a global trend. Centralized exchange volumes hit a 32-month low in July, while decentralized exchange market share climbed to a record 19.5%. As investors increasingly evaluate crypto on fundamentals rather than speculation, the trading-driven revenue model of centralized exchanges faces structural pressure.
What This Means for the Market
For the global crypto market, the Korean exchange slowdown is a signal that the retail-driven trading activity that fueled previous bull cycles is not returning in the same form. If Korean volumes continue to decline, exchanges will need to diversify their revenue streams beyond trading fees, potentially through institutional services, custody, or new product offerings.
The results also raise questions about the sustainability of exchange business models in a lower-volume environment. While the largest global exchanges may be able to absorb the decline through diversification, smaller platforms and regional leaders like Upbit and Bithumb face more acute pressure to adapt.
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