Korean capital flows offshore amid regulatory constraints
A new joint report by CoinGecko and Tiger Research reveals that South Korean investors transferred more than KRW 160 trillion, equivalent to roughly $110 billion, in crypto assets from domestic exchanges to overseas platforms throughout 2025.
The study attributes this large-scale outflow primarily to local regulatory restrictions that confine South Korean centralized exchanges largely to spot trading, limiting access to derivatives and more advanced trading products.
Offshore exchanges capture billions in fees
As a result of the migration, Korean users generated approximately KRW 4.77 trillion, or about $3.36 billion, in trading fees for offshore exchanges.
The bulk of this activity flowed to major global platforms, with Binance, Bybit, OKX, Bitget, and Huobi capturing the majority of volumes. Binance alone accounted for an estimated 57.7% of total fees paid by Korean traders.
Competitive disadvantage for domestic platforms
The report highlights a widening competitive gap between South Korean exchanges and their global counterparts. While local platforms remain compliant with strict regulatory frameworks, their limited product offerings appear to be driving sophisticated traders to seek alternatives abroad.
This dynamic has effectively shifted not only trading volume, but also revenue generation away from domestic firms.
BTCUSA outlook
The migration of over $110 billion in crypto assets underscores how regulatory design can directly shape market structure.
Unless South Korea revisits its exchange framework to allow broader trading functionality, offshore platforms are likely to remain the primary beneficiaries of Korean retail and professional crypto activity.
