South Korean investors have seen their cryptocurrency holdings drop by over 50% in the past year, with total holdings falling from KRW 121.8 trillion ($83.3 billion) in January 2025 to KRW 60.6 trillion ($41.4 billion) by February 2026. This significant decline is attributed to falling crypto prices and a shift in capital towards the stock market. Daily trading volumes on the country's five major exchanges also plummeted from $11.6 billion to $3 billion during the same period. The downturn coincides with increasing regulatory pressure, as authorities plan to introduce new anti-money laundering rules in August, mandating automatic labeling of cross-border crypto transactions over KRW 10 million. Additionally, a 22% tax on crypto gains is set to be implemented on January 1, 2027.