South Korea's cryptocurrency trading volume fell 28 percent from a year earlier, the biggest drop among major global markets. U.Today, a blockchain outlet, reported on Tuesday that South Korea kept its position as the world's No. 2 market by retail crypto activity in the first quarter of 2026, but actual trading shrank sharply.

In TRM Labs tallies, South Korea held on to second place in retail crypto activity behind the United States. U.S. trading volume was $212 billion. South Korea's decline was larger than the global average fall of 20 percent.

Money is moving into South Korea's stock market rather than cryptocurrencies. Retail investors are putting funds into domestic equities, following strong gains in artificial intelligence and semiconductor shares.

The KOSPI rose about 196 percent over the past year. It logged the highest return among the 20 major countries. By contrast, cryptocurrencies have largely moved sideways since peaking at the end of 2025.

Price volatility also encouraged the shift. On a recent trading day, bitcoin rose 4.7 percent while SK Hynix and Samsung Electro-Mechanics gained 6.42 percent and 16.63 percent, respectively. Big daily swings that once drew South Korean retail investors into cryptocurrencies have become more pronounced in large domestic technology shares.

South Korea has been regarded as a core market for crypto trading, backed by retail participation, technology infrastructure and a preference for high volatility. In the industry, South Korea has also been called an El Dorado of liquidity.