Polarization in Virtual Asset Exchanges... Feeling 'Helpless' as the Ripple Effect Disappears

Upbit Leads in Trading Volume, Dominates Market Share
Daily Volume Over 8 Times That of 2nd Place Bithumb
Smaller Exchanges Face 'Crisis' as Ripple Boost Weakens

Due to positive developments related to Ripple, the trading volume of domestic virtual asset exchanges has increased significantly, but the polarization between Upbit and other exchanges remains evident. As the trading volume, which had increased after the Ripple ruling, gradually decreases, relatively smaller exchanges are raising concerns about a 'crisis.'

According to CoinGecko, a virtual asset market monitoring site, as of 10:20 AM the previous day, Upbit's 24-hour trading volume was $1,567.88 million (approximately 2.0052 trillion KRW). This figure is about 8.24 times higher than Bithumb's trading volume of $190.32 million (approximately 243.1 billion KRW), which ranks second in market share. Compared to Coinone, ranked third, it is about 41.75 times higher, and compared to Gopax, which recorded the lowest trading volume among the top five exchanges, it was 544.40 times higher.

In the domestic coin market, the polarization between exchanges is clear. Especially, Upbit, which holds the top market share, has an overwhelming trading proportion. On the 10th of this month, among the trading volumes of the five major exchanges operating the KRW market, Upbit accounted for over 90%. At that time, the total daily trading volume of the five major exchanges was $1,175.59 million, of which Upbit's trading volume was $1,060.99 million.

Subsequently, on the 14th, Ripple Labs, the issuer of the virtual asset Ripple, effectively won the securities classification lawsuit against the U.S. Securities and Exchange Commission (SEC), leading to a significant increase in trading volumes across most exchanges. Despite this, Upbit's share of the total trading volume remained absolute. Compared to the 10th of this month, Upbit's daily trading volume increased by 47.78% on that day. During the same period, only Gopax saw a 20.66% decrease, while Bithumb, Coinone, and Korbit's trading volumes surged by 106.71%, 109.78%, and 275%, respectively. Even with the sharp increase in other exchanges' trading volumes, Upbit's share among the top five exchanges remained high at around 87%.

In this situation, the trading volume increase effect observed after the Ripple ruling is gradually fading, and as the prices of virtual assets including Bitcoin are gradually giving back their gains, smaller exchanges are even raising crisis concerns. This is because the smaller the scale, the greater the impact in a situation where coin prices are falling and trading volumes are decreasing. Additionally, as expectations that the coin market would revive due to Ripple's positive news are dashed, concerns are emerging that the 'crypto winter' will continue.

Earlier, a U.S. court ruled in a summary judgment that the SEC's claim that Ripple is an illegal security and its lawsuit against Ripple Labs was unfounded in terms of selling Ripple to general investors on exchanges, which was not a violation of federal securities laws. Although the court found that selling Ripple to institutional investors such as hedge funds violated federal securities laws, the fact that Ripple Labs was effectively considered the winner led to a general rise in coin prices, with Bitcoin rising from the $30,000 range to the $31,000 range. Expectations grew that the U.S. Commodity Futures Trading Commission (CFTC), which has lighter regulatory standards, would oversee the virtual asset market instead of the SEC. However, due to concerns about tightening, prices have now fallen to the $29,000 range, and excluding Ripple-related assets, other virtual assets have also shown a downward trend. As coin prices fall, trading volumes are gradually decreasing as well.

An industry insider explained, "There was hope that the coin market would revive if Ripple Labs won the lawsuit, but the positive effect did not last as long as expected. Bitcoin prices, which have large trading volumes, need to rise to some extent, but since that is not happening, the situation for smaller exchanges is indeed difficult." Another insider said, "For exchanges, fee revenue is absolute, so if trading volumes decrease, it becomes difficult to maintain operations or even leads to losses. If only exchanges with high market shares make money, the number of exchanges closing down will inevitably increase."

Professor Hwang Seok-jin of Dongguk University's Graduate School of International Information Security said, "It is not necessarily the fault of Upbit that its market share remains high due to user convenience and liquidity, but as the concentration phenomenon appears, concerns about monopoly and oligopoly may arise," adding, "Institutional measures such as allowing corporate virtual asset investments to supply liquidity to other exchanges are necessary."

This content was produced with the assistance of AI translation services.