South Koreans Pull $41B From Crypto as Bitcoin Slump Pushes Cash Into Stocks

Massive Capital Migration to Stocks

The value of virtual assets held by domestic investors in South Korea has plummeted by more than $41 billion (60 trillion won) over the last year, as a cooling crypto market prompted a mass migration of capital toward traditional equities. According to Bank of Korea data reportedly submitted May 10 to Rep. Cha Kyu-keun of the Rebuilding Korea Party, the total valuation of domestic virtual assets stood at approximately $41.17 billion as of the end of February.

The decline marks a staggering reversal from the market’s peak in January 2024, when holdings reached $82.76 billion. In just over 12 months, the total value of these digital portfolios has been slashed by more than half. The retreat from the crypto sector is further evidenced by a sharp contraction in trading volume and liquidity.

According to a local report, during the period under review, average daily trading volume, which surged to $11.62 billion in December 2024, fell to just $3.06 billion by February 2025. Won-denominated deposits—often viewed as “waiting funds” for future crypto purchases—dropped from $7.27 billion in late 2024 to $5.30 billion in February.

Analysts attribute this exodus to a “perfect storm” of a bullish global stock market and a simultaneous downturn in major cryptocurrencies like bitcoin. While the broader crypto market faced a sell-off, stablecoins saw a significant rise in popularity.

Holdings of stablecoins reached a high of $592.7 million in December 2024. Although that figure dipped to $412.5 million by February, the sector has still seen its value more than double compared to July 2024 levels, when holdings were a mere $60.1 million.

Meanwhile, financial experts quoted in the report suggest the surge in stablecoin demand is driven by South Koreans seeking dollar-based assets to hedge against high exchange rates and market volatility.

“The shift reflects an overall decline in valuation and a pivot toward more stable, interest-bearing domestic and international stock markets,” the report noted.