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Significant Decline in Crypto Trading: Upbit’s Volume Drops from March Peak
- Upbit, South Korea’s largest crypto exchange, recently experienced a 75% drop in trading volume, falling from $15 billion in March to $3.79 billion.
- The decline reflects a cooling trend in altcoin trading, amid concerns over the sustainability of their high market valuations.
- South Korean investors show a unique preference for altcoins over Bitcoin and Ethereum, differing from global trading patterns.
Upbit, South Korea’s biggest cryptocurrency exchange, has seen its trading volume plummet by 75% from its peak in March. The exchange’s 24-hour trading volume, which once stood at a high of $15 billion on March 5, has dramatically dropped to $3.79 billion, according to the latest data from CoinGecko.
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Steep Decline in Upbit’s Trading Volume
This steep decline in trading volume signals a cooling off in the once-frenzied altcoin trading market. Upbit, which offers a diverse range of 192 cryptocurrencies and 309 trading pairs, witnessed a surge in altcoin transactions in the early days of March. This surge was largely fueled by the excitement around the Dencun upgrade for Ethereum, known for reducing transaction fees, and heightened interest in cryptocurrencies during the election season.
Matrixport shed light on the situation in a recent Telegram broadcast, pointing out the spike in crypto trading volumes in early March due to heightened altcoin activity. However, they noted that with the recent downturn in trading volumes, there are growing concerns over the ability of altcoins to maintain their high market valuations.
South Koreans Differ in Altcoin Focus
On March 5, the total market cap of altcoins reached a two-year high of $788 billion, propelling Upbit’s daily volume. This was a time when Bitcoin soared to record highs above $70,000 and the Ethereum Dencun upgrade was a hot topic. The trading volume was so intense that, at one point, it surpassed that of the local stock market in South Korea.
Interestingly, the trading behavior of South Korean crypto enthusiasts differs significantly from global trends. A study conducted by DeSpread Research in October revealed that Upbit’s investors primarily focus on altcoins, seeking higher profits despite the associated risks. This contrasts with platforms like Coinbase, where trading is more concentrated on Bitcoin and Ethereum.
South Korea’s Unique Crypto Trading Behavior
As of this writing, the bitcoin-Korean won and ether-won trading pairs make up just over 9% of Upbit’s total 24-hour trading volume of $3.8 billion. The rest of the volume comes from trades involving altcoins and fiat currencies.
This downturn in Upbit’s trading volume is a significant development in the cryptocurrency market, reflecting a shift in investor sentiment and market dynamics. It highlights the volatile nature of the crypto market and suggests a potential recalibration in the focus and strategies of crypto traders. As the cryptocurrency landscape continues to evolve, these market movements are being closely monitored by investors and analysts alike, keen to understand the future trajectory of this rapidly changing sector.
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