South Korea & Hong Kong propel East Asia's crypto market expansion
The cryptocurrency market in East Asia is witnessing rapid growth, led by institutional adoption in South Korea and Hong Kong, according to a report from blockchain analytics firm Chainalysis.
The report highlights that South Korea has garnered $130 billion in on-chain value, positioning it as a regional leader, while Hong Kong has emerged as a key crypto hub due to its distinct regulatory environment.
The report identifies East Asia as the sixth-largest cryptocurrency economy in the world, with the region receiving over $400 billion in on-chain value between July 2023 and June 2024.
Institutional investors and professionals are increasingly turning to digital assets as scepticism toward traditional financial systems grows.
South Korea stands out for its substantial on-chain activity.
A South Korean exchange leader cited corporate adoption of blockchain technology as a driving force in bolstering public perception of cryptocurrencies.
"Mistrust in traditional financial systems has led investors to seek out cryptocurrencies as alternative assets," the leader noted.
Additionally, the popularity of altcoins and stablecoins in South Korea has driven higher outflows to global exchanges, partly due to the “kimchi premium,” where crypto prices in South Korea are often higher than in international markets.
Hong Kong’s cryptocurrency ecosystem continues to grow, driven by its regulatory framework.
The introduction of new regulations for virtual asset trading platforms in 2023 has boosted institutional adoption.
On April 30, Hong Kong’s Securities and Futures Commission (SFC) approved Bitcoin (CRYPTO:BTC) and Ether-based (CRYPTO:ETH) spot exchange-traded funds (ETFs) for public trading.
The lead-up to the ETF launch saw a surge in institutional Bitcoin transfers on mainstream exchanges serving institutional clients.
Kevin Cui, CEO of OSL, a digital asset trading platform in Hong Kong, noted, "These ETFs have not only provided a regulated pathway for investment in digital assets but have also spurred interest in direct holdings of BTC and ETH."
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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