Upbit, one of the largest cryptocurrency exchanges in South Korea, experienced a significant drop in its 24-hour trading volume at the beginning of April. After reaching a peak in March, the trading volume fell to $3.8 billion.
On March 5, Upbit recorded its highest daily trading volume of the year, reaching nearly $15 billion. This surge in trading volume can be attributed to Bitcoin’s new all-time high of $69,200 on the same day. The increase in trading activity was mainly driven by the inflow of new spot Bitcoin exchange-traded funds (ETFs) in the United States.
While Bitcoin was trading below $70,000 in other parts of the world, it reached a new all-time high of 96,734,000 South Korean won (approximately $72,504) on Upbit at around 3:00 pm UTC on March 5. This price difference between South Korea and the rest of the world is commonly known as the “Kimchi Premium,” named after the country’s famous fermented side dish. The Kimchi Premium refers to the disparity in BTC prices between Korean crypto trading platforms and international exchanges.
However, this surge in trading volume was short-lived, as the daily volume on Upbit dropped to as low as $2.6 billion on March 31. As of April 1, Upbit’s 24-hour trading volume stands at $3.8 billion, according to CoinGecko.
In 2023, Upbit’s parent company reported a significant decline of 81% in net profits. On November 28, Dunamu, the owner of Upbit, announced a profit of $23 million, much lower than the same period in 2022, when it earned around $123 million. The company attributed the decline in profits to a “sluggish investment market” resulting from an economic downturn, as well as the lower prices of digital assets.
Despite the drop in profits, Upbit continued its expansion efforts. On January 9, the exchange obtained a Major Payment Institution license from Singapore’s central bank, allowing it to provide crypto and fiat-related services in Singapore.