South Korea's FSC Reveals H1 2023 Virtual Asset Survey

Overview of fact-finding survey

□ The Korea Financial Intelligence Unit (Director Yunsu Lee) conducted a survey of 35 reporting businesses in the first half of 2023 to understand the current status of the domestic virtual asset market .

Main results of the survey in the first half of 2023

Virtual asset business operators (35) = 26 virtual asset exchanges (traders) + 9 wallets/storers

 ▴ Some coin market exchanges have difficulty conducting business continuously due to lack of commission sales.

 ▴ The proportion of independently listed virtual assets (59%, compared to domestic distributed virtual assets) is still high, but the number of stocks has slightly decreased ( △ 5.9%)

 ▴ Despite the recovery of the virtual asset market, average daily transaction volume ( △ 1.3%) and users ( △ 3%) decreased slightly.

 ▴ Virtual asset price volatility (62%) is still high, so careful investment decisions are needed.

Due to the rise in virtual asset prices and recovery of investment sentiment in the first half of '23 , market capitalization and won deposits increased compared to the second half of '22 , and the operating profit of exchanges (traders) also increased . 10 out of 21 coin market operators have no transaction fee sales , making it difficult to continue doing business in the future .

   * (Market capitalization (end of June 2023) ) KRW 28.4 trillion (+KRW 9 trillion, +46% compared to KRW 19.4 trillion at the end of 2022)

     (KRW deposits (end of June 2023) ) KRW 4.0 trillion (+0.4 trillion KRW, +11% compared to KRW 3.6 trillion at the end of 2022)

     (Total operating profit ('23.1) ) KRW 227.3 billion (+KRW 102.4 billion, +82% compared to KRW 124.9 billion in 2022)

New transaction support (new listings) and trading suspensions (delistings) on   virtual asset exchanges have increased significantly . The main reason for the suspension of trading was project risk (business continuity, etc.), and 66% of the virtual assets for which trading was suspended were exclusively listed virtual assets (handled by only one domestic business operator).

   * (New transaction support (23.1) ) 169 cases (+95 cases compared to 74 cases in 2022, +128%)

     (Transaction suspension (23.1) ) 115 cases (+37 cases, +47% compared to 78 cases in 2022)

     (Number of virtual assets (duplicate removal) (domestic distribution, end of June 2023) ) 622 types, (exclusively listed virtual assets (end of June 2023) ) 366

  Despite the recovery of the virtual asset market, domestic virtual asset transaction volume and users showed a slight decrease . The number of holders of assets worth less than 1 million won, which accounts for the majority of virtual asset users (73%, 4.43 million people) , also decreased slightly (△7%) .

   * (Daily average transaction size (above '23) ) KRW 2.9 trillion (△0.04 trillion won, △ 1.3% compared to KRW 2.94 trillion under '22 )

     (Transactionable users (end of June 2023) ) 6.06 million (△210,000 compared to 6.27 million in 2022, △ 3% )

  Price volatility is still high at 62% , the proportion of virtual asset transfers between domestic virtual asset business operators is 22%, and most of the external transfer amounts of virtual assets (72% of all users, 448,000) are small amounts ( less than 1 million won). It is done.