The harsh regulation in South Korea to control the involvement of its citizen with cryptocurrencies did not stop many of them from investing in volatile digital assets.
Fresh data released by Yoon Du-Hyeon, a lawmaker in the People Power Party, showed that over 2.43 million locals signed up for new accounts with the four major crypto exchanges in the country – Bithumb, Korbit, CoinOne, Upbit – in Q2 2021. The total deposit recorded on the exchanges has surpassed 6 billion USD as of July 31.
More remarkably, the total amount realized from kids below 20 from the four exchanges combined is about 3.4 million USD at the end of Q2 2021. This is a tremendous growth of up to 412% compared to the $824,000 recorded in Q1 2021.
A well-known analyst in the country has cited the soaring prices in real estate as the major reason for the people’s heavy involvement in the crypto space. The professor of Business at Sejong University, Kim Dae-jong, spoke with a media outlet in an interview said, “The country has more regulation on the real estate industry than ever. The property and real estate tax costs are getting unbearable. Teenagers who want to earn faster after seeing the heavy regulations on the real estate opt for cryptocurrencies for higher returns neglecting the risk involved.”
On the other side, citizens over 60 have high involvement with crypto as well after the group recorded a 6.3 million USD deposits increase compared to Q1 2021 in the four major crypto exchanges in South Korea. Despite having a total of 355 million USD deposits, the Post-Korean War generation was deemed more conservative when it comes to asset investment planning.
Jeon Sook-Ja, a 65-year-old South Korean speaking to a media outlet, said, “For the older generation, crypto investment has become an everyday conversation. It is no longer puzzling as people think it is. The common discussion amidst us now is what coins to buy or avoid.”
A professor of Tax Accounting from the Women University of Hanyang said, “There is a remarkable difference in the choice of investment strategies of the older citizens and the teenagers. Younger investors will want higher return over a maximum risk as the older ones will settle for only BTC and ETH.”
The fear attached to crypto in the country is not just the incessant warnings issued by the government but the countdown to the regulation of the space. Any crypto exchange that fails to comply with the issued standards tilt September 24 is risking closure.
Despite these, the South Koreans are still confident of crypto investments than ever. Years ago, the market had scepticism attached to it, but with each day passing, it is getting normalized in the country.