A detective cross-checked Bybit and Yahoo Finance data to calculate stock tracking error.

A detective cross-checked Bybit and Yahoo Finance data to calculate stock tracking error.

The Korean cryptocurrency market has seen significant shifts in the competitive landscape, with exchanges like Upbit and Bithumb thriving while smaller players like Coinone face liquidity challenges. According to recent reports [1], Upbit and Bithumb have experienced substantial growth, with their valuations surging significantly this year. Dunamu, which operates Upbit, saw its private stock price climb 33% year-to-date to 240,000 won ($173), with an estimated market capitalization now standing at 8.26 trillion won ($5.96 billion) [1]. Bithumb, on the other hand, performed even more impressively with a 131% surge to 238,000 won ($172) [1].

Both exchanges reached peak valuations on July 4th, with Dunamu hitting 258,000 won and Bithumb touching 275,000 won during the summer rally [1]. These gains reflect renewed optimism in cryptocurrency markets as Bitcoin repeatedly set new yearly highs. Both companies are positioning themselves for potential public offerings in the coming months, with Bithumb specifically targeting a Kosdaq listing for late 2025 [1].

In contrast, Coinone is facing mounting pressures with just 3% market share compared to dominant players [1]. The company announced plans to sell $2.96 million worth of cryptocurrencies, representing approximately 10% of Coinone’s total digital asset holdings [1]. This sale marks the first case under new regulatory guidelines introduced in May, which require advance disclosure and limits sales to top-20 cryptocurrencies by market capitalization [1].

Coinone’s sale will fund operational expenses, including personnel costs, rather than expansion or infrastructure [1]. The move signals urgent liquidity needs amid ongoing financial difficulties, with the company recording $4.4 million in operating losses last year and extending deficits to three consecutive years [1]. The cryptocurrency exchange sector increasingly favors scale as fee-based revenue models depend heavily on trading volumes [1]. Market concentration between Upbit’s 63% and Bithumb’s 33% share leaves little room for smaller competitors [1].

The contrasting fortunes of Upbit and Bithumb against Coinone illustrate the evolving dynamics of the Korean cryptocurrency market. As larger exchanges thrive, smaller players face significant challenges, necessitating strategic adaptations to survive in a competitive landscape [1]. The ongoing market concentration may lead to further consolidation in the sector.

References:
[1] https://en.coinotag.com/upbit-and-bithumb-thrive-amid-market-concentration-while-coinone-faces-liquidity-challenges-and-potential-acquisition-talks/