Rising demand for dollars for overseas investment has boosted trading in stablecoins that can serve as a dollar substitute.
According to data from the Bank of Korea, stablecoin trading rebounded sharply after hitting a low in June. Monthly trading value for dollar stablecoins (USDT, USDC and USDS) across South Korea's five major crypto exchanges - Upbit, Bithumb, Coinone, Korbit and Gopax - fell to 7.1 trillion won in June, the lowest since September 2024 (5.2 trillion won). But volumes then surged to 11.3 trillion won in July, 12.1 trillion won in August and 16.9 trillion won in September.
September's trading volume was the highest since February (24.6 trillion won), though it remained well below December of last year (31.7 trillion won), when the broader crypto market surged on expectations for U.S. President Donald Trump's second term.
Average daily trading showed a similar trend, falling to 238 billion won in June, the lowest since September 2024 (174.3 billion won) before climbing to 363.2 billion won in July, 391.1 billion won in August and 563.2 billion won in September.
The BOK's latest figures do not include October, but trading that month is estimated to have risen further. Upbit's own tally showed October trading volume for USDT, a leading stablecoin, at about 6.9 billion tokens, up more than 30 percent from September's roughly 5.2 billion.
The rebound has been attributed to the weakening won, which depreciated sharply against the dollar, from 1,366.95 in June to 1,423.36 in October.
A crypto market insider said investors expecting further gains in exchange rates may have bought stablecoins to acquire dollars, boosting trading volumes. The broader crypto market rally, with bitcoin hitting an all-time high in October, also likely contributed as well.
Meanwhile, discussions on introducing won-denominated stablecoins are likely to be delayed until next year, as related legislation remains pending at the National Assembly. The main focus of the debate is whether they should be limited to banks or extended to nonbank institutions such as fintech firms.
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